Preamble

The House met at half-past Two o'clock

PRAYERS

[MR. SPEAKER in the Chair]

PRIVATE BUSINESS

BRITISH RAILWAYS (No. 2) BILL

Order for Third Reading read.

To be read the Third time upon Thursday.

PETERBOROUGH DEVELOPMENT CORPORATION BILL [Lords]

As amended, considered; to be read the Third time.

Oral Answers to Questions — SOCIAL SERVICES

Research Sponsorship (Queen Mary College)

Mr. Campbell-Savours: asked the Secretary of State for Social Services whether he will provide more information on the type of sponsorship that is being provided by his Department of the search at Queen Mary college into the correlation between unemployment and mortality and on the research itself.

The Under-Secretary of State for Health and Social Security (Sir George Young): The Department has commissioned, under its standard conditions of support for research grants, two researchers at Queen Mary college, London university, to try to replicate the work of Professor Harvey Brenner on the correlation between unemployment and mortality. The project will take one year at an estimated cost of £15,000. I regret that I am unable to say more about the project than in my reply to the hon. Gentleman on 9 June, but it is expected that the results will be available next year and that they will be published.

Mr. Campbell-Savours: In the light of the disturbances last weekend in Southall and Toxteth, will the Minister seek to widen the terms of reference of the research of Dr. Harvey Brenner to include the link in the inner cities between stress, depression and unemployment?

Sir George Young: As the research project is under way, it would not be practicable to change the terms of reference in the way suggested by the hon. Gentleman. As a large number of those responsible for the mindless violence last weekend were under 16, it is difficult to see how unemployment can be a prime issue.

Mr. Jessel: As some people might die from the stress and strain of overwork and worry, might not early retirement save some lives? Is it not dangerous to indulge in sweeping generalisations?

Sir George Young: It is valid to say that, whatever the link between unemployment, stress and mortality may be, there is certainly a link between employment, stress and mortality.

Mrs. Dunwoody: Does not the Minister already have a report by Dr. Leonard Fagin on the effect of unemployment on the health of families? No efforts have been made to make that report public. Is he now suggesting that we must wait another year for another research project?

Sir George Young: That is untrue. My Department took trouble to make available to all the health correspondents of the national dailies the details of Dr. Fagin's study. We also made it clear that health correspondents could have a copy of the report and that we would talk to them if they were interested. A copy was made available to the Chairman of the Social Services Committee. In spite of efforts by the Department to generate media interest, the media did not respond. There is not much that we can do about that.

Mrs. Dunwoody: Why has not the Minister made the same effort to involve Members of Parliament? It is an important report that makes obvious the direct connection between unemployment and ill health. As that will be a continuing problem with the rise in unemployment, why is not the Minister initiating a debate on the Floor of the House?

Sir George Young: We placed a copy of the report in the Library. It is available to all Members of Parliament who wish to read it. I have described the other steps that we took to publicise the findings of the report. If the media do not respond, there is not much that Ministers can do about it.

Chapel-Allerton Hospital, Leeds

Mr. Joseph Dean: asked the Secretary of State for Social Services if, following the settlement for negligence by the Leeds area health authority in the case of Mrs. Joan Lee, he will set up a further inquiry into the neurosurgical department at Chapel-Allerton hospital, Leeds, to consider whether it is now providing a satisfactory standard of care.

The Minister for Health (Dr. Gerard Vaughan): I am aware of the hon. Gentleman's deep concern about this subject. He knows that the Leeds health authority has already conducted two full inquiries into this unhappy case and has made many changes and improvements in neurosurgical services. I hope that the hon. Gentleman will agree that a third inquiry is not necessary.

Mr. Dean: I disagree with the Minister on his last assumption. What was the total financial cost of the settlement, including court costs? Will that money have to come from the area health allocation, thereby diminishing the standard of service in the area? Does the Minister think that the person or persons responsible for that negligence should remain in employment under contract to the National Health Service after the death of that woman?

Dr. Vaughan: The employment of the individual concerned is at this stage a matter for the local health authority. The sums involved are personal matters that involve the families. I think that it would be better if I discussed this issue with the hon. Gentleman directly. I


shall be pleased to do so. As for the provision of general services, there has been a reallocation and rearrangement of the neurosurgical beds in the area. A fourth consultant neurosurgeon has been appointed and there is the possibility that a fifth will be appointed. There is every reason to expect that the services have been greatly improved.

Mr. Torney: Is the Minister aware that the death of one of my constituents, Mrs. Joan Lee, was undoubtedly caused by the neglect of this consultant surgeon? After he had instructed junior doctors to open her head prior to performing the operation himself, he was nowhere to be found and, in fact, was not in the hospital. May I urge the Minister to ensure that the consultant surgeon is no longer allowed to perform operations for the National Health Service and so cause further deaths?

Dr. Vaughan: The hon. Gentleman will be aware that the consultant concerned denies any negligence. At this stage the matter is one for the local health authority. In view of the deliberations of the Select Committee, and in an endeavour to improve the complaints procedure, we issued a memorandum in April that set out a different way of dealing with clinical complaints. The new method will come into operation in September.

Earnings-related Benefit

Mr. Cryer: asked the Secretary of State for Social Services what notification is being given to all those eligible persons regarding the ending of earnings-related benefit in 1982.

The Secretary of State for Social Services (Mr. Patrick Jenkin): Earnings-related supplement will continue for people whose entitlement to short-term benefits starts before 3 January 1982, subject to a final cutoff date of 30 June 1982. People who become eligible for short-term benefits after 3 January 1982 will be affected by the change unless they have claimed benefit in the preceding eight weeks. They will be informed. I am considering how best to give advance notice of the change.

Mr. Cryer: Is it not important for the Minister to mount a clear publicity campaign to tell the sick, the unemployed, the injured, widows and those in receipt of maternity allowances that the Government will rob them in 1982, in a full year of operation, of £300 million? Will he tell them that this gang of cheats, who are denying benefits to those who have made contributions, will prevent people from having their rights and will force them on to supplementary benefit, for which he will employ a further 1,000 civil servants? Is not this a disgraceful policy? Will he make clear to the recipients the full entitlement that the Government are denying them?

Mr. Jenkin: The hon. Gentleman knows that the change in the law was fully debated in the House and was approved by Parliament. He knows that the change will take place as Parliament decided. He will be aware that the value of the earnings-related supplement under Governments of both parties was allowed to fall substantially in real terms relative to average earnings and is now a little of over half its value in real terms of 10 years ago. In these circumstances, and at a time when it is not realistic to try to maintain the extravagant programmes that we inherited from our predecessors, it seemed right to make savings in respect of this benefit. I have told the

hon. Gentleman that we shall want to ensure that those who may become entitled to short-term benefits after January—who by definition are unknown—will be given advance notice of the changes that Parliament has approved.

Mr. Paul Dean: Will my right hon. Friend explain to those in receipt of the earnings-related supplement that owing to the sharp increase in social security benefits generally it is right that top priority should be given to fulfilling the Government's commitment to those on retirement pension, to the elderly, to the disabled and to other groups that are in the greatest need?

Mr. Jenkin: I am grateful to my hon. Friend for asking that supplementary question. It is right that we have maintained our commitment to retain the real value of the pension. We have maintained also the real value of the safety net. We have made other improvements in benefits for particularly needy groups, such as one-parent families and the elderly, who are in need of heating help. It was unrealistic to carry out those important social priorities and at the same time maintain in full the existing programme of social security benefits. The House has approved the changes and they will take effect from 3 January.

Mr. Rooker: Will the right hon. Gentleman confirm that the earnings-related supplement that would have been payable to an unemployed person from next January would have been £11·10 a week? Will he confirm also that as that benefit is not being paid at present to the unemployed due to the Civil Service dispute, those who are owed payments of the earnings-related supplement to unemployment benefit will receive the back pay, even if they have returned to work before the dispute ends?

Mr. Jenkin: The amount payable will depend on the man's earnings, as I am sure the hon. Gentleman recognises. It is a sad consequence of the industrial action by civil servants in my Department that benefits are not being paid as they fall due. It is our intention—I must warn the House that this may take some time in the recovery period—to pay any benefits which were due, but which were not paid, to those who were entitled to them.

Mr. Nicholas Winterton: I do not wish to be associated with the unnecessary diatribe of the hon. Member for Keighley (Mr. Cryer), but does my right hon. Friend accept that there is considerable grievance because of the phasing out of the supplement? Those who have paid contributions over many years feel that they should be entitled to the supplement when, through circumstances beyond their control, they are placed out of work.

Mr. Jenkin: I do not think that my hon. Friend is entitled to criticise in those terms a measure for which he voted.

Mr. Winterton: If my right hon. Friend the Secretary of State makes comments of that sort, he will not be able to rely on my support in future.

Mr. Speaker: Order. I do not always hear the arguments below the Gangway. In that I realise that I am fortunate. The House must allow the Minister to answer the next question.

North Humberside Health Districts

Mr. McNamara: asked the Secretary of State for Social Services, in view of his decision to create two


health districts in North Humberside, if he will ensure that the new Hull health district has adequate funds to cope with the cross-boundary flow from the Beverley health district.

Dr. Vaughan: I understand the hon. Gentleman's interest in this matter. Following the decision to have two districts for North Humberside, which we believe will give a very much better representation for community needs, the Yorkshire regional health authority will be considering how best to allocate money to patients living in one district but having treatment in another.

Mr. McNamara: It is not good enough for the Minister to say that he understands my interest and that the Yorkshire regional health authority is considering the issue. Is it not a fact that the majority of those living in the Beverley district who require skilled and advanced medical services will have to enter the Hull district? Is it not necessary for the Minister to ensure that the Yorkshire authority supplies the Hull authority with the necessary funds, to enable it properly to conduct its services for the people of Hull and Beverley?

Dr. Vaughan: I was interested to learn that the Members of Parliament representing the district of Beverley supported the Government's stance and saw it as an important step towards having proper local representation and a proper administration of their health service. We do not share the view that every new health authority has to be completely independent and viable in its own right. There are no reasons why there should not be exchange arrangements whereby patients may go to whichever centre is best able to give them the treatment that they need.

Mr. McNamara: In view of the unsatisfactory nature of that reply, I wish to give notice that I shall seek to raise the matter at the earliest opportunity in an Adjournment debate.

Civil Service Dispute (Retirement Pensioners)

Mr. Rooker: asked the Secretary of State for Social Services if he is satisfied with arrangements for new retirement pensioners during the Civil Service dispute.

The Under-Secretary of State for Health and Social Security (Mrs. Lynda Chalker): We regret the industrial action which has held up the issue of advance invitations to claim retirement pension and also prevented access to the contribution records used to calculate entitlement to retirement pension in new cases. In early June, we arranged for national publicity on and after 17 June to stress the need for those reaching pension age after 6 July to make their claim to their local office in good time to avoid possible loss of benefit. We have introduced special arrangements, backed by new regulations, to provide for interim payments at a basic rate to most new pensioners until new claims can be decided by the statutory adjudicating authorities.

Mr. Rooker: Why did the Government wait so long to issue the new regulations and to publish the advertisements advising pensioners when they could have taken the action 10 weeks earlier? Will the Minister confirm that, although emergency payments are being paid as from yesterday, any woman who reaches the age of 60 from this week and whose husband remains at work will not get even an

emergency payment, even if she has paid into the national insurance fund for a pension in her own right during the whole of her working life? If the hon. Lady can confirm that, will she try to defend it?

Mrs. Chalker: Had we acted earlier, we could have caused a great deal of unnecessary confusion and worry to those reaching pension age before 6 July. Those persons had had their claims processed, and their pension was being calculated in the normal way. We took immediate action as soon as we knew that the dispute would not be resolved at the beginning of June to make sure that all those likely to be affected would have the information. All the advertisements were approved at the earliest possible opportunity so that the information could be given to all those who might be affected.
I can confirm that married women whose husbands remain in employment are not catered for by these arrangements. It would be physically impossible for them to be so, bearing in mind the pressure on the Department's local offices, which are seeking to respond and to ensure that payments are made available to all those who, because of the industrial action taken by a few people in the Department, are without their rightful entitlement.

Mr. McCrindle: On the broader question of pension entitlement during the Civil Service dispute, will my hon. Friend take the opportunity to repeat that those already on pensions will continue to receive them on production of the stubs of the expired pension book? Failure to understand that is causing some unnecessary difficulties in certain quarters.

Mrs. Chalker: I confirm what my hon. Friend said. If people are already collecting their pensions, they continue to go to their local post offices to receive their pension, which will be paid week by week on production of their expired pension book. I stress that the pension must be claimed weekly. It cannot be paid several weeks at a time, as would be possible if an existing book were in operation. If there are any queries about the payment of pensions or other benefits, I ask hon. Members to advise their constituents to go to their local offices, where the instructions are clearly displayed and where the staff can advise on the best course of action to take.

Mr. Mike Thomas: Does the Minister agree that the hon. Member for Birmingham, Perry Barr (Mr. Rooker) cannot have it both ways? He supports the dispute, as do the official Opposition, but should they not have the courage to tell the Civil Service unions that action affecting pensioners and those who draw benefits is not the best way of making their well-justified point?

Mrs. Chalker: The hon. Gentleman is absolutely right. The way to ensure that those who are most vulnerable in society do not suffer is for a speedy return to work by all those who are at present holding up the payment of benefits to the hardest hit in society.

Mr. Rooker: That is in the Government's hands.

Mr. Paul Dean: While I welcome the arrangements that the Government have made, may I ask my hon. Friend to give an assurance that new pensioners will be given the benefit of any doubt and that there will be no question of those likely to be entitled to pension having to apply for supplementary benefit?

Mrs. Chalker: I am sure that I can give my hon. Friend that assurance. But if, before pension entitlement is fully


worked out, there is any case of hardship or need, I am quite sure that the local office will be able to help any pensioner in that predicament, perhaps through supplementary benefit, if other entitlements cannot be finalised.

Mr. Buchan: Is not there a stark contrast between the Government's behaviour in this dispute and the behaviour of the civil servants? Under extreme provocation and frustration, the civil servants have continued to ensure that the beneficiaries have been paid while the Government, who from the beginning knew that they intended to provoke and maintain a long-standing dispute, failed to take any measures to alert the beneficiaries. It was left to us to involve even the CBI to help with the publicity. That is disgraceful. Is not the best solution for the Government to drop their intransigence, to follow the lead that has been taken by the Civil Service, to settle the dispute, to give some justice back to the civil servants and to make sure that all beneficiaries are paid at the proper time and at the proper level?

Mrs. Chalker: The only way in which people who are vulnerable in society can be protected from the continuing industrial action is for civil servants to take up their grievances as they have always done in the past and not to withhold the payment of benefit through our computer centres. The hon. Gentleman knows perfectly well that extensive efforts have been made by my right hon. and hon. Friends at the Civil Service Department. Those efforts will continue and will bring this dispute to a successful resolution.

Schizophrenia

Mr. David Atkinson: asked the Secretary of State for Social Services what is his policy towards supporting those Who care for relatives who are suffering from schizophrenia.

Sir George Young: Our policy is that appropriate health and personal social services should be available to support those who have the responsibility of caring for relatives suffering from schizophrenia, as for others who support disabled people in the community. Carers may qualify for social security benefits. Voluntary organisations also have an important contribution to make in this task of "supporting the supporters". We are particularly conscious of the valuable work of the National Schizophrenia Fellowship, both in direct support of relatives and in developing local liaison so that health and social services give closer support. The Department gives a grant towards its national expenses.

Mr. Atkinson: I thank my hon. Friend for that encouraging reply. Is he aware that one in 100 people will suffer from this disease by the time that they are 45, as do more than half the patients in mental health hospitals? I urge him to embark on new research into both the causes and possible solutions to this problem.

Sir George Young: My hon. Friend is quite right to draw attention to the high incidence of this illness. Research is a matter for the Medical Research Council, which already includes schizophrenia within its research programme. I shall see what further action can be taken to bring forward more research projects.

Mr. Kilroy-Silk: Is the Minister aware that there is no point in his talking about these wonderful policies unless

they are backed up and implemented on the ground? Will he now name yet again all those local authorities that have no provision for either day or residential care for the mentally ill and indicate what action he will take so that they can provide for these disadvantaged people?

Sir George Young: If the hon. Gentleman tables a question, we shall make available the information that he seeks. In view of the number of local authority departments concerned, it will involve a lot of work. Over the last two and a half years, spending on personal social services has gone up by about 4 per cent. in real terms. We have maintained spending on the NHS along the lines planned by our predecessors. Therefore, the hon. Gentleman is wrong to imply that there have been any cuts in that programme as a whole.

"Compensating Employers for Statutory Sick Pay"

Mr. McCrindle: asked the Secretary of State for Social Services if he is satisfied that both alternatives outlined in "Compensating Employers for Statutory Sick Pay" are satisfactory to smaller businesses.

The Minister for Social Security, (Mr. Hugh Rossi): I am satisfied that each of the new options for compensating employers described in the document referred to by my hon. Friend goes a long way to meet the criticisms of earlier proposals made by the small business sector. The document will be the subject of consultation over the next two months and we shall be paying close attention to the views of all sectors of industry, including small businesses, before reaching any firm conclusion on what method of compensation to adopt.

Mr. McCrindle: Is it not a fact that, of the alternatives placed before employers, one of the schemes offers an additional reduction in the contribution rate of 0·4 per cent. to smaller businesses? Is it not also true that that second scheme offers an additional saving of 1,300 civil servants? In the light of those two advantages, does not my hon. Friend think that considerable care should be taken before proceeding with the alternative, no matter what representations he may receive from other quarters?

Mr. Rossi: In the scheme mentioned by my hon. Friend, the total amount of compensation that will be received by small businesses will be 0·9 per cent. That has been carefully calculated, and to increase it would mean taking away some benefits from other sectors of industry.

Mr. James A. Dunn: Can the Minister tell us what truth there is in the rumour that negotiations are now being undertaken to increase the compensation, and the amounts that would therefore be available to all businesses, not only small businesses, that applied the scheme? There is mention of a sum of about £100 million.

Mr. Rossi: I am unaware of the rumour to which the hon. Gentleman has referred. I assure him that we are receiving many representations on the consultation document, all of which we are taking into account. Our proposals will be announced in due course.

Mr. Buchan: Was not a major comment on this matter made in The Times a few weeks ago, suggesting that the employers will receive about £130 million over and above the amount that would be required to operate the scheme? Is not that at the expense of those who should be receiving sickness benefit, who will lose about £100 million? Is it


not nonsense to argue that the scheme will make public savings to any extent? Is not the truth that the scheme, which will unscramble one of the basic planks of the Welfare State, will save only about £20 million to £30 million?

Mr. Rossi: I do not accept the hon. Gentleman's conclusion. The reduction in public expenditure overall will be about £400 million. That will be debated in due course when the final scheme comes before the House. I assure the hon. Gentleman that that is so. The employees will be put in exactly the same position as if their current benefits were subject to taxation, which is the basis that the Opposition tried to achieve when they were in Government.

Community Health Councils (Leicestershire)

Mr. Latham: asked the Secretary of State for Social Services whether, following his decision to establish one district health authority for Leicestershire, he will make a statement on the future arrangements for community health councils within the county.

Dr. Vaughan: In circular HC(80)8 we said that there should be one community health council for each new district health authority. Only in the most exceptional circumstances would we be willing to vary this approach. We are at present considering whether the position in Leicestershire is so exceptional as to justify more than one community health council.

Mr. Latham: Is my hon. Friend aware that for thousands of my constituents in and around Melton Mowbray it makes little difference whether there is one CHC based in Leicester or, as now, three CHCs all based in Leicester, and that what is needed is greater identification by those bodies with the rural areas?

Dr. Vaughan: As a result of restructuring, we expect that the health authorities will be in closer contact with each of the communities. The whole point of that restructuring is that we should have as viable and local a Health Service as possible.

Departmental Offices (Privacy)

Mr. Skinner: asked the Secretary of State for Social Services what steps he is taking to ensure that maximum privacy is provided at Department of Health and Social Security offices for all people making requests for payments.

Mrs. Chalker: It has long been the policy of the Department that all local officers should be equipped with private cubicles or interview rooms. Standing instructions to local office staff stress that full use should be made of those facilities for callers who wish to discuss matters of a private nature, and appropriate notices are displayed.

Mr. Skinner: That is what it is like in theory, but in practice it does not work like that. Is the Minister aware that in my constituency I have had complaints at my general management committee from persons complaining about the attitude of the Government, who are inflicting cuts in social services that are resulting in people being herded around like cattle in some of the DHSS offices when they apply for supplementary benefits? All that was happening long before the civil servants were on strike.

What makes it worse is that recently a pilot scheme was introduced to push the disabled people into the same cubicles as the rest—

Mr. Speaker: Order. The hon. Gentleman must ask a question, like anyone else.

Mrs. Chalker: I understand that the arrangements at Chesterfield local office, which serves the hon. Gentleman's constituency, comply in all respects with our general policy in the provision of privacy. I am also informed that all our offices have been told that they should give access to privacy to those who call for it. I should like the hon. Gentleman to give me the details of the complaints that he has cited. I give him a firm assurance that I shall look into each and every one. If what he says is justified, I shall make sure that action is taken to prevent such things happening again.

Mr. Nicholas Winterton: Is my hon. Friend aware that those Members of Parliament who take the trouble to go to the DHSS offices, or even employment and jobcentres, are accorded privacy and courtesy by the officials in those departments in an exemplary fashion, and that the criticism that has been levelled by the hon. Member for Bolsover (Mr. Skinner) is completely irrelevant and not at all accurate?

Mrs. Chalker: I am grateful to my hon. Friend for confirming that the Department's standard policy of providing, where practicable, privacy screens and private interview rooms is carried out throughout the country.

"Compensating Employers for Statutory Sick Pay"

Mr. James A. Dunn: asked the Secretary of State for Social Services what is the anticipated increase or decrease in the net amount paid to recipients of sickness benefit which would result from the implementation of the proposals contained in the consultative document "Compensating Employers for Statutory Sick Pay".

Mr. Rossi: One of the purposes of the statutory sick pay scheme is to bring the majority of payments for short-term sickness into tax. The rate of statutory sick pay—£37 per week—has therefore been set so that recipients of sickness benefit as a whole will receive the same net income as they would if national insurance sickness benefits were brought into tax.

Mr. Dunn: Is the Minister aware of the apprehension that is felt among recipients and applicants for that benefit, not least those who are family men, who may find that there is a time lag in the payment of the full benefit that is due to them? What guarantee can he give that they will be no worse off under the changed system than they are under the existing system?

Mr. Rossi: The payment will be made direct to those people by their employers as wages. It will be a net amount, as if the sickness benefit had been made subject to tax. Therefore, there should be no need for apprehension.

Mr. Buchan: That makes nonsense of the Minister's previous statement with regard to flat-rate payment. In fact, there will be two flat-rate payments. May I come back to his global figures, when he said that £400 million of public expenditure would be saved? Is it not the case that that figure fails to take account of the amount of


compensation to be paid to employers of over £600 million, and when we do our sums are we not left with the minute figure of about £25 million that would be saved in the PSBR? I repeat: is it not nonsense to unscramble one of the basic planks of the Welfare State to save that minute amount of money?

Mr. Rossi: I repeat what I have already tried to say to the hon. Gentleman. We do not agree over our sums. I must challenge his figures. We shall debate the matter in due course. At the moment, I stand by the figures that I have already given to the House. The savings anticipated are of the amount that I have mentioned.

Mental Hospitals

Mr. Dubs: asked the Secretary of State for Social Services how many patients are currently in mental hospitals; and what is his estimate of the number that could be discharged if there was adequate community provision and support.

Mr. Patrick Jenkin: At the latest available date, there were about 45,500 people in mental handicap hospitals and units and a little over 76,000 people in mental illness hospitals and units. About 15,000—or one-third—of the former group have no medical reason to be in hospital, and it is thought that there may be up to 5,000 mental illness patients capable of living in a different setting.

Mr. Dubs: Does not the Secretary of State agree that those figures reveal an appalling situation for the mentally handicapped and the mentally ill? Does he agree that any person who could be discharged to the community should not remain in hospital a day longer than necessary? What will the Secretary of State do to ensure that local authorities meet their responsibilities?

Mr. Jenkin: The hon. Gentleman should give credit for the substantial reductions that have taken place under the policies of successive Governments, as spelt out in the two White Papers dealing with better services for the mentally handicapped and the mentally ill. The number of mentally ill people in hospital has decreased in 12 years from 112,000 to just over 76,000. The number of mentally handicapped people in hospital has decreased by over 10,000. The hon. Gentleman is right—our policy is to get people out of the hospitals and into the community. Later this month I hope to publish a new consultative paper setting out a number of options through which we can accelerate the transfer of patients and the resources needed to support them from the National Health Service to care agencies in the community.

Mr. Latham: Will my right hon. Friend remind the House of the significant and welcome fall in the number of children in mental hospitals, which he mentioned after the recent television programme?

Mr. Jenkin: I am glad to give the figures again. Ten years ago over 8,000 children were in mental handicap hospitals. Now the number is a little more than 2,000. By any standards, that represents substantial progress. Children, however severely handicapped they are, should not be brought up in hospitals.

Mr. Ashley: Is it true that the number of children in mental hospitals has fallen only because the children have become adults? Does the Secretary of State agree that mentally handicapped people cannot leave the hospitals

until adequate funds are earmarked and made available? Can he say when mentally handicapped people who should not be in hospital will be transferred to modern units?

Mr. Jenkin: It is tempting to set target dates. However, we must be realistic and recognise that what we all want to achieve is not wholly within our control. Six years ago, there were over 60 children at St. Lawrence's hospital. Today only six children are there. It is hoped that by next year it will be possible to close the school at that hospital. That will have been achieved in six years. The same story can be told of many other hospitals. We are all pursuing the same end and we hope to achieve it quickly.

Benefits (Take-up)

Mr. Allen McKay: asked the Secretary of State for Social Services what help and guidance he is giving to local authorities which are engaging in campaigns to increase the take-up of benefits.

Mrs. Chalker: We regard such help and guidance as vital to such campaigns. I am pleased that the Association of Metropolitan Authorities has stressed to its members the importance of co-operation with my Department. We, in our turn, have asked local management to become actively involved in any campaigns organised in their areas. We hope that any campaigns will be closely targeted.

Mr. McKay: I thank the Minister for that reply because it represents a different attitude from that previously taken by the Ministry. Will she congratulate the city of Sheffield on its initiative? Will she encourage closer co-operation, since that is to the benefit not only of the recipients but of the relationship between local and national government?

Mrs. Chalker: I am glad that Sheffield has taken up the campaign. I understand that it will operate through a local authority newspaper. There is close contact with our local management so that the campaign can be targeted towards the people who are entitled to benefit. It will help to increase take-up.

Mr. Cryer: Does the Minister recognise that local authorities are suffering from the depredations carried out by the Secretary of State for the Environment and are very short of money? Is she aware that Labour-controlled Bradford has embarked upon a scheme of informing people about their welfare rights? Will she find some money to help local authorities practically to embark on such schemes, because they are proving to be of real benefit?

Mrs. Chalker: Local authorities must determine their Own expenditure priorities. It is not a matter for central Government. How a local authority decides on individual priorities must be a matter for that local authority. The efforts made to improve take-up of one-parent benefit and family income supplement are fully supported by my Department. We shall do what we can to improve that take-up.

Widowers (Pensions)

Mr. R. C. Mitchell: asked the Secretary of State for Social Services whether he will introduce legislation to provide a pension for widowers who have to give up employment to look after their young children.

Mr. Rossi: We have no plans to introduce such legislation.

Mr. Mitchell: Is the Minister aware that a large number of widowers who have had to give up their jobs to look after their young children are forced to go on supplementary benefit? Does he accept equality for men and women? Will he refer the matter to the Equal Opportunities Commission?

Mr. Rossi: I do not disagree with the principle of equality for widowers and widows. The resources are not available to implement a change. An equivalent scheme for widowers would cost about £110 million a year at November 1981 benefit rates. We must content ourselves with leaving widowers to apply for supplementary benefit. They have additional help from the one-parent benefit.

Mr. Newens: Does the Minister recognise that it is preferable for children to remain at home when they have lost their mother? Does he accept that some widowers are forced to make other arrangements for their children and to put them in care or board them out? Does he agree that eventually that results in greater expenditure? Will he look at the matter again?

Mr. Rossi: Of course I agree that it is far better for children to be treated in the way that the hon. Gentleman suggests. The widower can do part-time work and take advantage of the beneficial rates of family income supplement that apply to a one-parent family. He can make other arrangements for his children when he has to go to work.

Oral Answers to Questions — PRIME MINISTER

Trades Union Congress

Q 1. Mr. Walter Johnson: asked the Prime Minister when she next expects to meet the general council of the Trades Union Congress.

The Prime Minister (Mrs. Margaret Thatcher): I have no immediate plans to do so.

Mr. Johnson: Is the Prime Minister aware that over 12½ million trade unionists are affiliated to the TUC and that, with their families, they represent over half the population of Britain? In the national interest, therefore, will the Prime Minister and her colleagues stop baiting and alienating the trade unions? Will she work with them and with the TUC and try to deal with some of the serious problems, particularly unemployment?

The Prime Minister: If representatives of the TUC ask to see me, of course I shall see them. I have never refused to see them when they have asked to come along together, although rather a lot of them have come along together. This House represents all the people. I work through this House.

Sir William Clark: When my right hon. Friend next sees the general council of the TUC, will she remind it that a massive increase in public expenditure, both revenue and capital, coupled with a massive increase in direct and indirect taxation, will inevitably lead to an increase in the public sector borrowing requirement, probably to between £20 million and £25 million? Does she agree that that would increase the bank rate, increase inflation, increase the cost of mortgages, increase the cost of businesses and

result in unemployment? Does my right hon. Friend agree that anyone advocating such a course is irresponsible and not fitted to lead a Government?

The Prime Minister: I agree with my hon. Friend. One cannot pursue a policy of taxing less and spending more while hoping to make ends meet.

Mr. Bidwell: Is the right hon. Lady aware that Mr. Len Murray, the general secretary of the TUC, insists that when he sees her it is like having a dialogue with the deaf?

The Prime Minister: I had no idea that Mr. Murray was deaf.

President of France

Mr. Dykes: asked the Prime Minister what recent discussions she has had with the new President of the Republic of France.

The Prime Minister: I met the new President of France at the European Council in Luxembourg on 29 and 30 June. As I mentioned in my statement to the House on 1 July, I also had talks with him on the morning of 30 June.

Mr. Dykes: I thank my right hon. Friend for that answer. Notwithstanding the political colour of the new Administration in Paris, and following the friendly encounter that my right hon. Friend had with President Mitterrand, is she more confident that friendly and positive relations between Britain and France will allow us to tackle some of the more serious EEC problems such as those concerning the budget and foreign policy co-ordination, as well as certain pressing bilateral matters such as the Channel tunnel?

The Prime Minister: It is always good to start on a friendly basis. I do not think that the situation will be much changed when we come to the tough negotiations ahead. Each Head of Government fights his country's corner. France does that, and we do that. In the end, we must arrive at arrangements which are equitable and fair to all partners in the interests of all members of the European Economic Community. That we shall do.

Mr. Heffer: When the right hon. Lady met the President of France, did she take the opportunity to discuss the President's programme for employment prospects and putting the French people back to work? Has she learnt anything from that? May we have an assurance that she will carry out a similar policy here, especially to help areas such as Liverpool with its mass unemployment, which is responsible for the terrible outbreaks of violence in the last few days?

The Prime Minister: With regard to the French programme, the French President is increasing the public deficit from 1½ per cent. to 3 per cent. of gross domestic product. The deficit in this country—the amount that we have to borrow—is already 4½ per cent. of GDP, so even on that programme the French President will be following a pretty conservative policy. With regard to some of the other policy matters, I do not think that the hon. Member would like me to follow them. They include a 7 per cent. value added tax on food and a 17½ per cent. standard rate tax on ordinary goods and materials.
With regard to the hon. Gentleman's remarks about Liverpool, I do not think that anything would condone the violence that took place. One must totally condemn it.


Unemployment may well be a factor, but I do not believe that it is the principal factor. It may well be a factor. As the hon. Gentleman will have heard in the exchange that took place yesterday when my right hon. Friend the Home Secretary was answering questions, there were Opposition Members who said that they did not think that unemployment was the main cause.

Mr. Tapsell: Did President Mitterrand refer to his announced plans to increase the amount of French research into higher technology by 50 per cent. over the next five years, from 1·5 per cent. to 2·3 per cent. of their GDP? Is my right hon. Friend aware that that will still leave France far behind Japan, where one company has 10,000 products already in the final stages of research and ready to go into manufacture? In an increasingly competitive world, will my right hon. Friend set in being a study to examine how Britain can improve our own educational training, practical skills and manufacturing capacity in higher technology?

The Prime Minister: The short answer to my hon. Friend is that we did not discuss a particular programme. It was generally agreed between Heads of Government that we must put a good deal of emphasis on the new technological industries. As my hon. Friend knows, in this country we, too, are trying to place special emphasis on the new information technologies and have a programme to try to get a computer in every school by the end of next year. That seems a reasonable start. One is only too anxious to put more into investment, particularly into applied technology. In this country we tend to put rather a lot into pure research and perhaps not sufficient into applied research.

Mr. McNamara: Did the Prime Minister discuss the fishing dispute with the French President? Did she reaffirm the Government's intention to have a 12-mile limit solely for British fishermen and a 50-mile dominant area for British fishermen? What sort of agreement did she reach with President Mitterrand on that?

The Prime Minister: We did not discuss the fishing matter in detail with the President. We made it very clear that it matters a great deal to this country that we get a common fisheries policy as quickly as we can. I had hoped to achieve it before the French elections. I believe that President Mitterrand also wants it for his fishermen, but I believe that there is some quite tough negotiating ahead to achieve what is appropriate, suitable and equitable for the fishermen of both countries.

Mr. Aitken: Did my right hon. Friend get the impression from President Mitterrand that the French Socialist Party is firmly committed to NATO and to the retention of France's independent nuclear deterrent? Is not that an interesting and sharp contrast with the policy of the British Labour Party?

The Prime Minister: The French Government are not fully militarily integrated into NATO. President Mitterrand is fully committed to his independent nuclear deterrent, and I believe that he is fully committed to spending a proper and full amount on the defence of France and, therefore, playing a full part in the Western Alliance.

Engagements

Mr. Kilroy-Silk: asked the Prime Minister if she will list her official engagements for Tuesday 7 July.

The Prime Minister: This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall be having further meetings later today.

Mr. Kilroy-Silk: Will the Prime Minister reflect today on that the fact that, whatever were the causes of the riot in Liverpool, the origin was not in racial conflict, as the right hon. Member for Down, South (Mr. Powell) would like to believe? Is she aware that the area is deprived and neglected, not least by herself, as she has persistently refused to visit that city? Is she further aware that she has not visited it since she became Prime Minister and that she also refused to meet representatives of the People's March for Jobs? Will she now visit the area to see at first hand what her policies are doing to young people? Will she order an inquiry into the causes of the disturbance and confirm the Home Secretary's statement to me yesterday that there will be an investigation into the policing of the area and the relationship between the police and the local community?

The Prime Minister: I shall, of course, visit Liverpool rather sooner than I had thought. My right hon. Friend the Home Secretary is there today. I have already spoken to him. He had some very valuable and constructive meetings this morning with both the metropolitan county authority and the Liverpool council, all of whom praised the police as well as the ambulance and fire services very highly indeed. All of them are anxious to put the terrible events of the last few days behind them and to try to give some hope and improved morale to the area. As the hon. Gentleman knows, there are very big problems. Unemployment is most certainly one of them. My right hon. Friend is well aware of that and so am I. Factories have been closing for quite a long time, even before the general election. We are anxious to take a very constructive approach to the problem and to help all that we can. At an appropriate time, I shall certainly visit the area.

Mr. Garel-Jones: Will my right hon. Friend find time in her busy day to discuss with my right hon. Friend the Home Secretary the extraordinary number of people who have put their names forward as candidates in the Warrington by-election? Will she extend that conversation to cover the Representation of the People Act, which is now so full of anomalies as to lay it wide open to those who wish to bring our system into disrepute?

The Prime Minister: I have no doubt that my right hon. Friend gives attention to the needed reforms in the Representation of the People Act, but I do not think that at the moment he will give it the utmost priority as there are a number of other problems in legislation confronting us ahead of that.

Mr. Foot: Reverting to the subject of Liverpool, Southall and the other very serious disturbances which took place, while we fully understand that the Home Secretary had to direct his attention yesterday primarily to the question of how the police could deal with the immediate situation, has the right hon. Lady had time to reflect on the proposal made by my right hon. Friend the Member for Birmingham, Sparkbrook (Mr. Hattersley) to


the effect that the present inquiry instituted by the Home Secretary into some of these matters should be greatly extended and should be directed against some of the deeper causes of the deprivation in those areas and what may be the consequences of them?
In view of the way in which mass unemployment among young people contributes to situations of this kind, will the right hon. Lady review every single one of her policies touching on these matters to ensure that all measures calculated to increase that unemployment are put into reverse?

The Prime Minister: With regard to the right hon. Gentleman's comments about inquiring into the causes, I understand that when Lord Scarman has completed his initial inquiry on Brixton he will be looking at other areas. I believe that Liverpool will probably be one of them. That would be the natural thing to do, because it was the worst experience that we have yet had in this country. One is naturally anxious to try to get closer to the causes. In the meantime, however, one's first action must always be to uphold the law and to support the police—not necessarily to find excuses, but to find reasons and first and foremost to uphold the law and support the police. We congratulate the police on the work that they have done.
With regard to other measures to try to combat unemployment, we have indeed been trying to do everything we can in Liverpool. That is exactly why we started an urban development corporation, to try to cut through some of the red tape of working through so many authorities. Even yesterday, we were unable to get an order through the House to pass £17·1 million to the urban development corporation to carry out the initial stages of its task. We have set up an enterprise zone. I am afraid that all this takes time. It takes time because of the legislative procedures and the inquiries that are necessary. We are also putting, and will continue to put, a great deal into the youth opportunities programme. I agree with the right hon. Gentleman that there is no substitute for genuine jobs. They must come when people buy the goods and services produced here. One cannot get away from that.

Mr. Foot: We shall have to return to the subject of the nature and scale of the inquiry, as the Prime Minister has not yet grasped the general significance of the matter. I wish to ask the right hon. Lady about some of the specific measures that her Government have taken, which have contributed to youth unemployment. I refer, for example, to the cuts she proposes to make in university education. Cuts will be made in grants to Salford university. Does the right hon. Lady think that that is a good policy to pursue when she has such trouble in Liverpool? The same point applies to many other places. As a result of the right hon. Lady's policies, only half the previous number of apprentices are being trained. In addition, her policies have led to the greatest increase in mass youth unemployment that the country has known. Those are the policies for which the right hon. Lady is primarily responsible, as the right hon. Member for Sidcup (Mr. Heath) pointed out last week. When will the right hon. Lady change them?

The Prime Minister: As regards finding work experience and training for young people, and some short-time working subsidy, we are spending approximately £1 billion to help people either to keep jobs or to gain some work experience. That is a considerable sum. I agree that

we would like to have more apprenticeships. However, one of the things we ought to look at is the restriction on entry to apprenticeships. We must also consider why some of those who have been retrained in skillcentres are not allowed a trade union ticket, which means that they cannot get jobs. If the right hon. Gentleman is asking me to give further consideration to what I would call the obstacles to higher employment, I must tell him that we are already looking at things such as the Employment Protection Act and the high wages—in comparison with those paid to older workers—that sometimes have to be paid to young people. I agree with the right hon. Gentleman that it is vital to deal with such matters.

Mr. Foot: rose—

Mr. Dickens: On a point of order, Mr. Speaker. I am sure that you will not wish to—[Interruption.]

Mr. Speaker: Order. This is not the place for any hon. Member to be shouted down. We must allow hon. Members to speak in this Chamber.

Mr. Dickens: On a point of order, Mr. Speaker. I am certain that you must have overlooked the fact that the time is 3.33 pm.

Mr. Speaker: The hon. Gentleman is as helpful as usual—but no more than usual.

Mr. Skinner: On a point of order, Mr. Speaker. It has been brought to my attention—[HON. MEMBERS: "Oh."]—that at a time when this Tory Government are smashing the social fabric of the country—[HON. MEMBERS: "Oh."]—with 3 million people unemployed—[HON. MEMBERS: "Oh."]—and with social services—[Interruption]—being—

Mr. Speaker: Order. I want to hear what the hon. Gentleman has to say, but he must have a point of order.

Mr. Skinner: With all those cuts in public expenditure, it has been brought to my attention that you felt it necessary a few days ago, Mr. Speaker, to attend a function at the home of the hon. Member for Christchurch and Lymington (Mr. Adley) to raise funds—

Mr. Speaker: Order. If the hon. Gentleman wishes to criticise my conduct, he knows what to do. But he does not do so in the form of a question.

Mr. Skinner: rose—

Mr. Faulds: On a point of order, Mr. Speaker. When you were very helpfully aided by your popular timekeeper, the Leader of the Opposition was on his feet asking a question. May he be allowed to finish it?

Mr. Skinner: On a point of order, Mr. Speaker—

Mr. Speaker: Order. If the hon. Member for Bolsover (Mr. Skinner) wishes to criticise my conduct, he knows what to do. It is not done through a point of order. I tell the hon. Gentleman that I am not dealing with this matter on a point of order.

Mr. Skinner: rose—

Mr. Faulds: rose—

Mr. Speaker: May I say to the hon. Member for Bolsover, for the last time, that this is not a point of order with which—[Interruption.] I am not answerable to the hon. Gentleman at Question Time for what I do at weekends.

Mr. Skinner: Raising funds for the Conservative Party.

Mr. Speaker: If the hon. Gentleman persists, I shall require him to leave the Chamber, because I am not going to enter into a personal argument.

Mr. Skinner: rose—

Hon. Members: Name him.

The Lord Privy Seal (Sir Ian Gilmour): rose—

Mr. Speaker: Order. I have no desire to name the hon. Member for Bolsover, but he is making it very difficult for me not to order him to leave this Chamber. I am not pursuing that subject now. I call the Lord Privy Seal to make a statement.

Sir Ian Gilmour: rose—

Mr. Skinner: On a point of order, Mr. Speaker.

Mr. Speaker: If it is a different point of order, I shall take it. If it is the same point of order, I shall require the hon. Gentleman to leave the Chamber for the rest of this day's sitting.

Mr. Skinner: I am giving you an opportunity, Mr. Speaker, to tell the House why it was—

Mr. Speaker: Order. The hon. Member for Bolsover will leave this Chamber for the rest of this day's sitting.

Mr. Skinner: What for?

Mr. Speaker: If the hon. Gentleman does not leave the Chamber, I shall have no recourse but to name him. The hon. Gentleman will now leave the Chamber for this day's sitting.

Mr. Skinner: I shall raise this somewhere else.

Mr. Speaker: Order. The hon. Gentleman will leave the Chamber for the rest of this day's sitting.

The hon. Member, having conducted himself in a grossly disorderly manner, was ordered by MR. SPEAKER, pursuant to Standing Order No. 23 (Disorderly conduct), to withdraw immediately from the House during the remainder of this day's Sitting, and he withdrew accordingly.

Secretary of State for Foreign and Commonwealth Affairs (Moscow Visit)

The Lord Privy Seal (Sir Ian Gilmour): With permission, Mr. Speaker, I will make a statement about my right hon. and noble Friend's visit to Moscow. [Interruption.]

Mr. Frank Hooley: On a point of order, Mr. Speaker. It is impossible to hear what the Lord Privy Seal is saying. Can he wait until we can hear?

Mr. Speaker: I thought that the time had come when I could call the right hon. Gentleman. Apparently it has come now.

Sir Ian Gilmour: My right hon. and noble Friend paid a short working visit to Moscow for discussions with the Soviet Foreign Minister on 6 July.
His principal purpose was to present to the Soviet Government the proposal adopted by the European Council on 30 June for a two-stage international conference on Afghanistan. Discussion of this matter occupied a full morning of talks.
In explaining the proposal, my right hon. and noble Friend made it plain that he was speaking on behalf of the ten member States of the European Community. He emphasised that the problem with which it dealt was one of global significance whose solution was essential in the interest of peace, stability and the development of East-West relations.
He reminded the Soviet Government that the Ten—and indeed the great majority of the international community—are convinced that the complete withdrawal of Soviet troops is an essential element of any solution.
Mr. Gromyko took the view that the proposal by the Ten was, as he put it, "unrealistic", because the main problem was intervention by others in the affairs of Afghanistan, because it was not stated that the present Afghan regime should participate at the outset and because the proposed composition of the conference was unsatisfactory.
My right hon. and noble Friend told him that he did not find these arguments convincing. Mr. Gromyko did not say that he rejected the proposal and did not exclude further discussion. For his part, my noble Friend made it plain that the proposal, which has already received an encouraging degree of support in the international community, remains on the table and that its details are open for discussion.
The brief communiqué which was agreed at the end of the visit refers to the intention of both sides to continue the dialogue. My right hon. and noble Friend made it clear that as far as he was concerned this means about Afghanistan. He will now wish to consult his colleagues in the Ten on the next steps.
He also spoke to Mr. Gromyko about theatre nuclear forces, the Madrid conference and the Middle East. On theatre nuclear forces, he took issue with some of the figures put forward and pointed out that the problem could only be resolved in the negotiations between the Soviet Union and the United States which are due to start before the end of the year.
They agreed that the situation in the Middle East was dangerous and that the right way forward was a negotiated settlement, even though our views on timing and method differed.
They shared the view that if agreement could be reached in Madrid on the area to which new confidence-building measures would apply, the way should be clear for a rapid conclusion of the conference.

Mr. Denis Healey: While one applauds the Foreign Secretary's desire, which I am sure we all share, to secure the withdrawal of Soviet troops from Afghanistan, does the Lord Privy Seal agree that the summit conference grossly overplayed the prospects of the success of that initiative on Afghanistan to distract attention from the wilting of its Middle East initiative and its failure to tackle the crises in the Common Market on the common agricultural policy and the budgetary regime? Does he not agree that the only concrete result of the Foreign Secretary's visit so far has been to infuriate the Italian Government by failing to consult them in advance?
The Lord Privy Seal told us that theatre nuclear forces were also discussed. Can he confirm the report that Mr. Brezhnev told Mr. Willy Brandt on his recent visit to Moscow that the Soviet Union would cease deploying the SS20 missiles the moment talks began on theatre nuclear weapons, even if the United States continued to develop and produce the cruise missile, and that the Soviet Union would be prepared for such talks to discuss a cut in the number of SS20s already deployed? Finally, on the Middle East, which was also discussed, what view do Her Majesty's Government take of the evidence of substantial increases in Soviet forces and equipment in Syria in the last few days?

Sir Ian Gilmour: I do not accept what the right hon. Gentleman says about my right hon. and noble Friend's visit to Moscow. I do not agree that the plan put forward at the European Council was grossly overplayed, still less for the reasons that the right hon. Gentleman gave. It was extremely useful that an essentially reasonable scheme was introduced to the Russians. If they do not intend to agree to it, they must find convincing reasons for turning it down. They have not done that. I should have thought that the right hon. Gentleman would agree that it was right that the continuing Soviet invasion and oppression of Afghanistan should be kept before the notice of the world. That is what my noble Friend has done.
I cannot confirm what the right hon. Gentleman said about the talks between Mr. Brezhnev and Mr. Willy Brandt but I can confirm, as I said in the statement, that my right hon. and noble Friend pointed out to Mr. Gromyko that talks would be beginning this year between the United States and the Soviet Union and that the decision would be made only in that forum.

Mr. Healey: If the summit conference did not grossly exaggerate the importance of the initiative, why did not the Foreign Secretary, the moment that the meeting was over, spread the news around that it was unlikely that the initiative would have a chance of success? Secondly, if the Foreign Secretary discussed theatre nuclear forces when he was there, surely he must have asked Mr. Gromyko whether Mr. Brezhnev's reported intentions were his intentions. Cannot the Lord Privy Seal tell us something


about that? Finally, will he answer the question about the build-up of Soviet forces and equipment in Syria, as that is a serious matter?

Sir Ian Gilmour: I cannot say anything about the so-called build-up of the Soviet forces in Syria, which did not come up at the talks that my noble Friend had with Mr. Gromyko. The right hon. Gentleman's idea that the initiative was overplayed is contradicted by what he has said. My right hon. and noble Friend was at the European conference in his official capacity. If he said, as the right hon. Gentleman alleges, that it was unlikely that the initiative would be an immediate success, that proves that the initiative was not overplayed.

Mr. Healey: What about Mr. Brezhnev?

Mr. Speaker: Order. During the debate on the defence White Paper a large number of right hon. and hon. Members will try to catch my eye. I do not propose to allow questions on the statement to go beyond five minutes to 4 o'clock. There is also a Ten-Minute Bill.

Mr. David Steel: Is the Lord Privy Seal aware that there is a school of thought at present in Washington and sometimes in this country which says that unless Ministers return from a mission of this kind with cut and dried items of success, the whole meeting has been a failure and a washout? Will he resist such a view and accept that public opinion is concerned about the continuing invasion of Afghanistan and the deployment of theatre nuclear forces and that the Foreign Secretary must go on trying?

Sir Ian Gilmour: I am grateful to the right hon. Gentleman for what he has said. If any Foreign Secretary was prepared to take an initiative only if he knew for certain in advance that it would be successful, the world would be a more dangerous place than it is.

Mr. Dennis Walters: The Foreign Secretary's wise decision to visit Rome immediately after Moscow must have gone a long way to dispel Italian ill feeling at the lack of an invitation to the Italian Foreign Minister to the meeting before the visit to Moscow. Will my right hon. Friend try to ensure that in future Italian participation is ensured at such meetings?

Sir Ian Gilmour: I take my hon. Friend's point, but my noble Friend must be allowed to meet his colleagues as and when he likes. There cannot be any restriction on that freedom. As my hon. Friend pointed out, he met Signor Colombo on his way back from Moscow.

Mr. James Lamond: I congratulate the Foreign Secretary on his initiative and wish him every success, but why, as he was prepared to extend the discussion beyond Afghanistan to include nuclear weapons and the Middle East, was the Lord Privy Seal so careful to add in his statement that the reference in the Community to continuing dialogue was only about Afghanistan?

Sir Ian Gilmour: It is surely as plain to the hon. Gentleman as it is to the whole House that the future of East-West relations depends on a settlement of the Afghanistan problem. Until that is settled, they will not be as they were before the invasion.

Sir Frederic Bennett: Although I agree that the Foreign Secretary's visit was worth while to keep the

issue of the Afghan invasion in the public eye—as the Leader of the Liberal Party rightly said is essential, because we must not appear to accept the situation and let things go—does the Lord Privy Seal accept that there is accumulating evidence that the Soviet Union is not militarily invading and occupying Afghanistan simply to add another satellite to its empire, but, from its infrastructure of roads and its building of military forward bases in the south of the country, it is apparent that it regards the invasion as yet another step towards further Soviet ventures?

Sir Ian Gilmour: I should not like to speculate about that, but the evidence is consistent with what my hon. Friend says. However, as he well knows, the Soviet Union is not having an easy time in trying to subdue Afghanistan. Indeed, after his recent visit to Poland, Mr. Gromyko talked about the problem of Afghanistan. I believe that it has been driven home to the Soviet Union that it has a considerable problem on its hands.

Mr. Robert Maclennan: Did the Foreign Secretary form the view that the position of the Soviet Union had in any way changed? Does he believe that further discussions are likely to follow to clarify what Mr. Gromyko meant by "unrealistic"?

Sir Ian Gilmour: We must hope so, but it is difficult to say. As I said in my statement, the reasons that the Soviet Union gave were far from convincing. It is not realistic—to use that word—to pretend that the problem of Afghanistan is one of external intervention and that the massive invasion of about 85,000 Soviet troops is not part of that intervention. It is impossible to say whether further discussions will follow. As I said in my statement, my noble Friend will consult his colleagues in the Ten and in other countries in the international community to see the best way forward.

Mr. Kenneth Warren: I welcome the Foreign Secretary's insistence on keeping the initiative in Moscow going, but will he bear in mind the fact that the Russian leadership probably needs the initiative as much as the West and must now realise in its heart that it has no military means to escape from the turmoil created in Afghanistan?

Sir Ian Gilmour: That is very likely true. As my hon. Friend will be aware, as long ago as last February the Soviet Union stated that it was ready for discussions on the international aspect of the situation in Afghanistan. During my noble Friend's visit, Mr. Gromyko did not explain in what way the European proposal failed to provide for such a discussion.

Mr. Andrew Faulds: Will the Lord Privy Seal now be good enough to answer the question put forward by my right hon. Friend the Member for Leeds, East (Mr. Healey) about the reported exchange between Brezhnev and ex-Chancellor Brandt?

Sir Ian Gilmour: I have no information on that point.

Mr. Raymond Whitney: May I welcome the Afghan initiative, which some of us have been urging on the Foreign and Commonwealth Office for over a year, but will my right hon. Friend accept that what was needed—and after the Moscow visit is needed perhaps even more—is a much wider mobilisation of international opinion generally, so that the pressure of that opinion on


the Soviet Union is as great as it was in the case of Rhodesia? Does he accept that what was granted through the Lancaster House talks to the people of Zimbabwe could, through a widely based international initiative, be achieved for the people of Afghanistan?

Sir Ian Gilmour: Obviously I sympathise with my hon. Friend's general argument, but he will be aware that at the first discussion of the matter at the United Nations 104 nations condemned the Soviet invasion and that at the next 111 did so. There is, therefore, a wide measure of international condemnation of the Soviet Union. As my noble Friend's visit made clear, we shall continue our efforts to keep the subject before all international forums and before the bar of world opinion.

Mr. Frank Allaun: Before the talks, Mr. Brezhnev offered a moratorium on medium-range missiles in Europe. Did the right hon. Gentleman see the report of Mr. Abartov, the leading Soviet disarmament expert, who offered to go further and consider the reduction or removal of the SS20s already in Europe?

Sir Ian Gilmour: It is, in fact, the deployment of the SS20s that has largely created the problem. It would, indeed, be entirely right for the Soviet Union to take them away, and we should certainly welcome that.

Disturbances (Liverpool)

Mr. Anthony Steen: I beg to ask leave to move the Adjournment of the House, under Standing Order No. 9, for the purpose of discussing a specific and important matter that should have urgent consideration, namely,
the breakdown of law and order in Liverpool and the continued damage, looting and violence in the inner city".
Last night was the third night of rioting, pillaging, looting, arson and violence and the breakdown of law and order in Liverpool. The police say that they can no longer guarantee the safety of any person or his property. The fabric of society is under attack from marauding gangs of youths and militant thugs. Last night, the situation worsened. Far from the violence abating, it has fanned outwards, becoming more indiscriminate, more senseless and less containable.
In Toxteth, 300 youths roamed the streets at about midnight, hurling stones; the police charged with batons. A mile away, a jeweller's shop was pillaged and a supermarket looted. Young people smashed the windows, while their friends and families waited outside with trolleys, suitcases and prams to steal and pillage. A five-year-old child was seen filling his pillow case.
Near the waterfront, shops and property were set on fire and ransacked. The violence did not stop there but spilled over into my constituency, where six buses were stolen and shop owners were threatened with violence and destruction.
There is mounting fear and growing anxiety all over Liverpool. About 40 vehicles have been hijacked and used as battering rams or set alight. Extensive damage to street lighting, roads and fencing is also evident. Showrooms, private houses, shops, store rooms, banks, and furniture stores have been burned and destroyed.
Millions of pounds of public and private and public investment are laid waste. Shops are boarded up. New cars are being moved from showrooms. Trucks are being moved from British Rail at Lime Street. City centre stores are putting away their goods and putting up their shutters, preparing for the next wave of violence. Liverpool is in a state of siege, with waves of violence spilling out from the epicentre at Toxteth to the rest of the city.
Over the weekend, 77 people were arrested. Last night alone a further 75 were arrested, including 10 teenage girls. Two thousand police are standing by, and 200 have already been injured, 41 of whom were seriously injured and are still in hospital. Rumour has it that the disruption may soon spread to schools, where provocative leaflets are being distributed. The situation is volatile and inflammatory. Liverpool could become another Ulster—a barricaded city, but on the mainland.
We are witnessing anarchy, destruction and uncontrolled hostility towards the police and authority. A new kind of civil war is being waged, where neighbour steals from neighbour and the enemy is authority, law and order.
As the Mother of Parliaments, we must be seen to defend our citizens. This is an attack on us all. I respectfully ask the House to recognise that there is a state of emergency in Liverpool that demands urgent and immediate debate.

Mr. Speaker: The hon. Member for Liverpool, Wavertree (Mr. Steen) gave me notice this morning before


12 o'clock that he would seek leave to move the Adjournment of the House under Standing Order No. 9 for the purpose of discussing a specific and important matter that he believes should have urgent consideration, namely,
the breakdown of law and order in Liverpool and the continued damage, looting and violence in the inner city.
I received a similar application before 12 o'clock yesterday morning from the hon. Member for Liverpool, Edge Hill (Mr. Alton). When the hon. Gentleman heard yesterday afternoon's exchanges, he withdrew his application at my request.
The House knows that I am required to take into account the several factors set out in Standing Order No. 9 but to give no reasons for my decision. The House and the country are aware of the seriousness of the situation, but, without going into reasons, I must say that, having listened to yesterday's exchanges on the matter, I cannot submit the hon. Gentleman's application to the House.

Statutory Instruments, &c.

Mr. Speaker: In order to save the time of the House, I propose to put together the Questions on the five motions relating to statutory instruments.

Ordered,


That the draft Double Taxation Relief (Air Transport Undertakings and their Employees) (China) Order 1981 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Double Taxation Relief (Taxes on Income) (India) Order 1981 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Double Taxation Relief (Taxes on Income) (Mauritius) Order 1981 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Double Taxation Relief (Taxes on Income) (Switzerland) Order 1981 be referred to a Standing Committee on Statutory Instruments, &amp;c.
That the draft Double Taxation Relief (Taxes on Income) (Thailand) Order 1981 be referred to a Standing Committee on Statutory Instruments, &amp;c.—[Mr. Goodlad.]

WALES

Ordered,
That the matter of the Welsh Development Agency, being a matter relating exclusively to Wales, be referred to the Welsh Grand Committee for their consideration.—[Mr. Goodlad.]

Garden Supplies (Sunday Trading)

Mr. Nicholas Lyell: I beg to move,
That leave be given to bring in a Bill to amend schedule 5 of the Shops Act 1950 to make lawful the sale of garden supplies on Sunday; and for connected purposes.
I am grateful for the opportunity to squeeze between the heavy matters of foreign affairs and defence one of the sillier nonsenses that afflict a more civilised aspect of our lives—that of gardening.
The object of my Bill is to make lawful the widespread trade in garden supplies and equipment which takes place every Sunday of the year at about 2,000 garden centres throughout the country. Gardening is probably the most popular hobby in this country. Millions of our citizens are gardeners and few hon. Members have not enjoyed gardening at some time.
However, since the garden centre boom has grown up almost entirely since the passing of the Shops Act 1950, which is the present law dealing with Sunday trading, the only garden supplies that can be lawfully traded on Sundays are flowers, fruit and vegetables. When hon. Members hear that that includes mushrooms but not tinned vegetables, they will realise that even that trade is lawful only by a sidewind and was intended for florists and greengrocers.
Selling almost everything else that gardeners flock to buy at garden centres every Sunday is unlawful. If one buys a trowel, a bag of peat, a can of insecticide, a ball of twine, a lawnmower, a plastic pot or a plastic gnome, the garden centre that sells it in England or Wales is breaking the law.
The situation would not be a matter of concern if nobody prosecuted, but that is not the case. The Independent Garden Centres Association recently conducted a survey of its many members and replies to date show that, although about three-quarters of local authorities are good enough to use their discretion and turn a blind eye to the technical offences that are being committed, 10 per cent. or 12 per cent. prosecute, often regularly, and about 15 per cent. are threatening to prosecute.
Fines range from £2, which may seem trivial, to £200 for a first offence and from £50 to £100 for every item sold in second and subsequent offences. One large garden centre in the South of England is threatened with closure on Sunday by injunction, because it is being prosecuted frequently.
The situation is nonsense. The small survey that produced those figures underestimates the problem. There are about 2,000 garden centres nationwide. Indeed, there may be even more. If hon. Members reflect on the numbers in their constituencies they will realise that the total rapidly builds up.
The 2,000 centres employ about 9,000 people full-time and even more part-time. The vast bulk of their trade is conducted on Saturdays and Sundays, by overwhelming public demand. Almost all garden centres open on Sundays, because that is when the gardeners of England and Wales wish to buy their supplies. Complaints are virtually negligible and usually involve parking or other such matters.
The problem can easily be resolved. It simply requires a small change to schedule 5 of the Shops Act to add


garden supplies to the list of other articles that are permitted to be sold. The second most popular hobby is going for a spin in the car, and motoring supplies can be sold lawfully on a Sunday.
Some people ask why it is right to tackle the problem of Sunday trading in garden centres separately from the wider issues of Sunday trading. The answer is simple. If all the shops in Oxford Street and our local high streets were open on a Sunday, that would be a radical change from the present position. but garden centres are open and trading, by huge popular demand, all over the country on Sundays. If we made a small change in the law we would not be introducing a fundamental alteration to our customs, but we would remove from jeopardy those who supply us with the goods that underlie the pleasure rightly enjoyed by so many millions on a Sunday.
There is no trade union objection to the Bill, as there is—for understandable reasons, whether one agrees with them or not—from USDAW and other unions in relation to shops in Oxford Street and local high streets. I cannot speak for the Lord's Day Observance Society, but it has not indicated that it opposes the hobby of Sunday gardening. As time is short, I shall desist from going into biblical matters, but there is the strongest authority in the Bible for suggesting that there is no more suitable hobby on a Sunday than gardening.
It is not only that it is absolute folly that our law should remain in this state for such a popular hobby, but it is thoroughly unjust to the garden centres that meet our needs that they should be put at risk of criminal prosecution so often. That is why I seek leave to introduce the Bill and, if time allows, to remedy the injustice once and for all.

Question put and agreed to.

Bill ordered to be brought in by Mr. Nicholas Lyell, Mr. Michael Ancram, Mr. Kenneth Carlisle, Mr. Patrick Cormack, Viscount Cranborne, Mr. Mark Lennox-Boyd, Mr. Peter Rost and Mr. Michael Spicer.

GARDEN SUPPLIES (SUNDAY TRADING)

Mr. Nicholas Lyell accordingly presented a Bill to amend schedule 5 of the Shops Act 1950 to make lawful the sale of garden supplies on Sunday; and for connected purposes: And the same was read the First time; and ordered to be read a Second time upon Friday and to be printed. [Bill 179].

Defence Programme

Mr. Speaker: Before calling the Secretary of State for Defence, I shall inform the House that I have selected the amendment in the name of the right hon. Member for Plymouth, Devonport (Dr. Owen).

Mr. Churchill: On a point of order, Mr. Speaker. I wonder whether you have overlooked the amendment standing in my name and the names of 10 of my right hon. and hon. Friends. Will you reconsider your selection of amendments, bearing in mind that the selected amendment was signed by only two Members in addition to the right hon. Member for Plymouth, Devonport (Dr. Owen)?

Mr. Speaker: The House knows that I never give reasons for my selection of amendments, and the House does not expect me to give reasons. I merely say in passing, not by way of reasons, that I never measure the importance of an amendment or any other matter by an arithmetical formula.

Mr. Geoffrey Johnson Smith: Further to that point of order, Mr. Speaker. We all appreciate that this matter lies completely within your discretion, but some hon. Members, on looking at the problem—

Mr. Speaker: Order. Is the hon. Gentleman seeking to challenge my selection of just one amendment? If so, he is not raising a point of order. I could tell the hon. Gentleman what he is doing, but he is not raising a point of order.

Mr. Johnson Smith: I was seeking your guidance, Mr. Speaker, on how to interpret not your selection but the fact that I had always understood that it would be a political party whose amendment would be selected. Some hon. Members—

Mr. Speaker: Order. Although the hon. Gentleman is not challenging my selection, he does not like it. It appears that there is only one Member in the Chamber who does—

Mr. James Wellbeloved: There are two.

Mr. Speaker: I beg the hon. Gentleman's pardon; there are two.

The Secretary of State for Defence (Mr. John Nott): I beg to move,
That this House approves the White Paper on 'The United Kingdom Defence Programme: The Way Forward' (Cmnd. 8288).
The first duty of any British Government is to safeguard our people in peace and freedom. Peace requires will, it demands vigilance, and it does not come cheap.
No one can doubt the capacity of the British people to respond to a national crisis in time of war, but history warns us that it is less easy to ask them to pay a heavy premium to insure against war in time of peace. But for 35 years, under successive Governments, we, with the other members of NATO, have paid that premium, arid as a result Europe has enjoyed, and still enjoys, peace.
No one can be certain whether the right hon. Member for Leeds, East (Mr. Healey) was correct when on 7 May he said that the tensions in Europe since 1945 would in any


other period of world history have led to war. But it seems sensible to give him the benefit of the doubt. Security is not an area of policy where there is anything to be gained from taking risks. If deterrence has worked, it would indeed be an odd moment to diminish it because the international scene is in many areas unsettled and even turbulent. Soviet conventional military power, already massive, continues to grow in size, quality and reach—and the Soviet leaders continue to demonstrate their readiness to use it brutally.
At another level, nuclear weapons exist. They cannot be disinvented or wished away. Quite apart from the massive Soviet strategic armoury targeted on the United States, the Soviet Union deploys very large numbers of nuclear weapons capable of striking targets anywhere in Europe and it is modernising the capability at an alarming rate. On average, each week more than one new Soviet SS20 nuclear missile is deployed.
However much we may share a sense of horror about these weapons and work for non-proliferation and arms control, it would be a strange moment to choose defencelessness for ourselves. Let us be clear: such a course would certainly not influence the Soviet Union, nor would it have any effect on any non-nuclear State—of which there are several—contemplating developing nuclear weapons of its own.
I believe that the British people generally are prepared to face the task of keeping the peace in an increasingly violent world. In asking them to fund a real increase in defence expenditure of 3 per cent. for the next four years we are, of course, asking them to forgo other benefits of a more visible kind. But, while I have no doubts about the readiness of the British people to make some additional sacrifice for security, there seem to be faint hearts in high places less ready to meet the challenge. Perhaps the greatest danger that we face is from a failure of will, a creeping demoralisation in the face of the seeming hopelessness of it all, and a loss of confidence in our ability to preserve our fundamental values in the face of a world which seems increasingly doomed to violence.
Those who undermine and demoralise our defences with defeatist and neutralist talk can unwittingly become a cause of war. I should not be so foolish as to suggest that those who hold genuine pacifist views are in the pay of some international conspiracy, but whatever their motives—I believe that they are genuine—they, too, sing the Kremlin's song, because, unwittingly, they lead the Soviet leadership to believe that the West no longer has the will to resist. The huge campaign now being conducted from the Kremlin against the modernisation of NATO's long-range theatre nuclear weapons is evidence enough of the Soviets' determination to break our will.
Consider only the fact that for the last three years the Soviet Union has been deploying long-range theatre nuclear missiles of enormous accuracy on targets throughout Europe, and on our own homes here in the United Kingdom, whereas all that NATO possesses is a force of ageing Vulcans and United States F111 aircraft. Indeed, the Vulcans are increasingly difficult to keep maintained and flying in the air, let alone capable of penetrating Soviet defences. Is it seriously suggested that we can cease the modernisation of our deterrent and freeze the position as it is—leaving the Soviets' existing SS20 missiles in their place?
I quoted a Russian admiral in my last speech to the House. At the risk of arousing anxiety about my bedtime reading, I should now like to give a short quotation from a Russian general. General Yepishev, head of the political directorate of the Soviet Army, said recently:
Nuclear weapons in imperialist hands threaten mankind: in the hand of the Soviet Army they serve to defend peace and the foremost social system in the world.
Whatever hon. Gentlemen below the Gangway—who are not very well represented today—

Mr. James Callaghan: Withdraw.

Mr. Nott: I was referring not to the right hon. Member the former Prime Minister but to other hon. Gentlemen.
Whatever hon. Gentlemen below the Gangway may propose, I doubt whether the vast majority of our fellow countrymen are prepared to put their future in a Soviet general's hands, but that is precisely what the Campaign for Nuclear Disarmament would seek to do and what those who seek to turn the Labour Party into what Mr. Sidney Weighell has recently described as a Bolshevik-style organisation want to do.
"The Way Forward", to use the words of the White Paper, is not an easy one. In times of economic difficulty we are having to ask our people to contribute significantly more to defence. We are asking members of the Armed Forces and their supporting civilian staff to accept radical change and, most painful of all, having to reduce jobs in our dockyards by 1984 in order to provide the resources to keep our front line strong.
In 1981 we have to be prepared to defend ourselves against wars fought at three distinct levels. There are the threat of subversion and terrorism, the threat of Soviet intervention, directly or by proxy, in non-aligned countries, as with its invasion of Afghanistan, and, finally, the threat of direct military conflict.
First, at the level of armed terrorism and subversion, every day we read of outrages by gun and bomb. We cannot compromise with that threat. We must maintain law and order in Northern Ireland. We shall continue to make preparations to combat terrorism, whether here at home or against our vital oil and gas installations off the coast. If we have to act, as in the siege at Prince's Gate, we shall act decisively.
Secondly, in reviewing our defence programme the Government have had to look far beyond the confines of our small corner of Europe. We must recognise the threat to our peace and prosperity from the other side of the globe. Soviet leadership will follow the dictum attributed to Lenin:
Probe with bayonets. If you find mush—proceed; if you encounter steel—withdraw.
Soviet oil production may well peak in the next two or three years, although its consumption will continue to increase. It may find new areas of production, such as the Barents sea, and it may compensate for its lost oil export earnings by supplying natural gas to Western Europe. But Eastern Europe may be forced to buy large quantities of oil from the OPEC countries of the Middle East, with little prospect of finding the hard currency earnings to pay for it. In one area, at least, therefore—the Middle East—Soviet political, strategic and economic interest all point in the same direction. The dangers are clear.
The Government fully recognise that the security and stability of Third world countries are in the first place


matters for the States themselves, and it is in that spirit that we do everything possible through military training, assistance and the supply of equipment precisely to help them build up their ability to defend themselves.
But we have a role to play, by a presence, in out-of-area deployments. That is why we have made special provision in the defence review to enable Royal Navy ships, whether with a carrier group or with a group of frigates, to resume deployments for visits and exercises beginning in the next financial year. We have had to cancel some of these deployments this year as a result of cash problems in our budget.
We are also continuing with the plans to build up a stockpile of essential equipment for such tasks. The designation of a command structure, the conversion of our Hercules aircraft for assault parachute tasks in an emergency and other preparations have all been maintained in the programme. With this plan we envisage being able to make a contribution, together with the United States and other allies, should we be called upon to protect the interests of friendly local States or wider Western interests in strategic regions.
Thirdly, I turn nearer to home, to Europe. The flanks of NATO must be secured, and the United Kingdom makes, and will continue to make, a vital contribution here through the provision of reinforcement forces for the major NATO commanders, including the unique and irreplaceable skills of the Royal Marine Commandos.
Is direct military conflict likely in Europe? As Winston Churchill said in 1946:
I do not believe that Soviet Russia desires war. What they desire is the fruits of war and the indefinite expansion of their power and doctrines.
That is true today, and I do not believe that, at present, the Soviet leadership seeks a direct military confrontation with Western Europe—and that in itself is proof of the success of the Western Alliance.
But with a single-party State, with the Soviet leadership in the possession of overwhelming and still growing military power, who can be certain of the future? Who can tell what problems will come for its successors, with popular discontent inevitable over living standards, with demographic problems—a steep increase in the birth rate of the non-Slav peoples, especially the 50 million Muslims in Central Asia—and all this held together by a repressive bureaucracy and supplied by a heavily over-centralised and inefficient economic system? Can we disregard totally even the possibility in years to come of a disintegrating Soviet empire, with, as an act of desperation, the dying giant lashing out across the central front?
If—and this is only speculation—such circumstances were ever to arise, what would be the Soviets' objectives? The United Kingdom, as a principal reinforcement base for NATO, would in my view be a first and immediate target, together with West Germany. The aggressor would have to deal with both countries quickly. If the Soviets attempted to smash a way through on the central front with their overwhelming conventional superiority, there might be a war that was nasty, brutish and short—for we should remember that today's conventional weapons are far more destructive than those used in any previous war.
So deterrence must begin for us in Europe. If the British Isles cannot be defended against Soviet special forces, if the central front and the flanks do not hold, no reinforcement from the United States will be possible over the succeeding months. The forward defence of Germany is the forward defence of the United Kingdom itself, and these islands are—leaving aside the question of nuclear weapons entirely—the overriding first target, given our key position and geographical location off the shores of Continental Europe.
In the defence review, therefore, we looked first at our ability to hold such an attack, as well as to deter it. If it ever came, it would be a blitzkrieg of immense conventional force, and the Channel would not protect the United Kingdom base from, for instance, the highly trained Soviet special forces in the same way as it protected us in 1940.
I shall not list again the substantial enhancement of our land-air and United Kingdom air defence capability above present levels, set out in the White Paper. But I stress that we gave particular attention to an increase in war stocks and ammunition—to the extent that I estimate that we shall be increasing the staying power of First British Corps by 20 to 30 per cent. I repeat that this raises the nuclear threshold in the most cost-effective way open to us.
It would, of course, have been more glamorous and indeed welcome to British industry to announce even more new orders for tanks and aircraft, but, if we were to be able to afford to maintain most existing procurement programmes—as indeed we have done—the best way of increasing combat endurance was by enhancing war stocks.
I have no doubt that, leaving aside the more ambitious plans and aspirations of my Department, we have substantially increased the effectiveness of our land-air capability above its existing levels.
That brings me to our maritime air capability. I emphasise here that, so far as I can judge, we have not made a major shift away from our maritime and air capability in the Atlantic. These things are difficult to calculate and involve many difficult judgments of where to attribute resources, but I estimate that there may be a minor—but only a minor—shift away from our maritime air capability to our land-air commitment.
The sea systems procurement Vote will still be increasing in real terms in the next four years. The reduction in what is misleadingly described as the Royal Navy's share, when in fact we are talking not about shares but about capabilities, comes in fact mostly from the dockyard programme, which will fall by 25 to 30 per cent. against a planned increase of 11 per cent. over the next four years.
Of the three main tasks in the Atlantic—first, the covering, as best we can, of the Greenland-Iceland-United Kingdom gap and other choke points against Soviet submarines; secondly, the prosecution of anti-submarine warfare generally in the Atlantic; and, thirdly, the protection of reinforcement shipping—I am confident that we are enhancing our capability in the first two.
Our decision to continue unabated with the nuclear and conventional submarine programme, the extension of our Nimrod II conversion programmes, the procurement of Sea Eagle and Sting Ray and the running on of our Buccaneers are all a major plus.
That brings me to the third area that has been the principal point of controversy—reinforcement by sea. I have already made the point that if we lose on the other fronts reinforcement is irrelevant—it will be too late. The manpower reserves will come by air, and we must protect the air lanes in the first days of war. We must pre-position as much heavy equipment as we can in Europe, but I have always recognised, first, that no one can predict the course of any future conflict and, secondly, that massive reinforcement of heavy equipment by sea will be essential if we succeed in holding the first aggressive thrust.
Naturally, I recognise the important role of the surface fleet in times of peace and war. I recognise, too, that we can never be sure that a future conflict might not start with deliberate naval brinkmanship by the Soviet Union. But we have to assess priorities in the 1990s and beyond, not least in the light of the latest class of Russian submarines, which are now equipped with anti-surface-ship cruise missiles with a range of 250 miles—outside the range of even the proposed Sea King replacement helicopter.
We cannot ignore costs; our resources are not infinite. We have in the past maintained the size of our surface fleet only by expensive major refits and mid-life modernisations of older ships. Typically, as I said in my statement, it can now cost up to £70 million to modernise an old Leander frigate, which is more than our target cost for a new type 23 frigate.

Sir Frederick Burden: If we abolish the Leander type and introduce the new type 23 frigate, a much lighter frigate with a cheaper hull, it will still surely require a great deal of sophisticated equipment, which automatically will require the servicing that must be carried out by specialists now in Her Majesty's dockyards. How will my right hon. Friend replace it? How will he carry out that proper and frequent servicing if he abolishes that speciality in the dockyards?

Mr. Nott: I accept that this is an important question. I shall deal with dockyard capacity in a moment. Clearly, we could not have conceived of closing Chatham dockyard and naval base and severely reducing the size of Portsmouth if we were not convinced that we could conduct those programmes adequately with the remaining dockyard capacity.
I want to deal with dockyard capacity in a moment. My genuine desire was to afford within our budget a new shipbuilding programme, modern weapons for our ships and a reasonably sized surface fleet. Something had to give. The new procurement programme would not have been possible if we had kept the supporting dockyard structure at its present size.
I was much influenced by the dockyard study prepared under the chairmanship of my hon. Friend the Member for Ashford (Mr. Speed). In annex I. which is available in the Library for all hon. Members to read, there is a most useful analysis of the cost-effectiveness of the policy of refitting surface ships. The Select Committee on Defence is examining the position. If we are prepared to accept the painful employment changes that I have proposed for the dockyards, we shall be able to release substantial financial resources in this supporting area.
I do not claim any originality in identifying these changes, because they have been the subject of continuous arguments and study within the Royal Navy for many

years. As the House knows, we are proposing a reduction in our NATO declarations from 59 escort ships, of which about three are in the standby squadron and many others are under major modernisation, to about 50, of which about eight will be the standby squadron, but with fewer ships in a low state of readiness for major dockyard refits.

Mr. Dick Douglas: In the long discussions between the hon. Member for Ashford (Mr. Speed), who had to resign, and the trade unions, the unions accepted the dockyard study as a package deal against a background of full employment in the dockyards. How does the Secretary of State propose to continue these negotiations against a background of dockyard closures?

Mr. Nott: I have already met the departmental trade unions once. I shall be seeing them again within the next 10 days. I do not seek to deny the sad consequences of my announcement for the dockyards, particularly Chatham and Portsmouth. It was a most painful and difficult thing to have to announce.
The point that I have to make is that within a rising defence budget of 3 per cent. for the next four years, which, with due respect to the hon. Gentleman, I do not think his party would deliver, it was almost impossible to enhance our front line capability unless I looked somewhere to save costs. I looked to the infrastructure rather than to the front line. I regret, naturally, the announcement that I have had to make about Chatham and Portsmouth.

Mr. Stephen Ross: I wish to challenge the Secretary of State on his figure of 50 active surface ships left to the Navy after the cuts. Is that correct? The interpretation made by others is that the figure is less than 40. A number of frigates are scheduled to come out over the next few years, and the replacements will not be coming in.

Mr. Nott: I repeat that the present force declarations are 59 escort ships—that is destroyers and frigates. Of that 59, three are at present in the standby squadron. Apart from those three, a considerable number of the 59 are in major mid-life modernisation, which takes a considerable time. At the moment, I believe that there are four or five—there are normally more than that—in major mid-life modernisation. One cannot say that that number is at present in the operational fleet. They are in major mid-life modernisation. I accept that under my proposals there will be a smaller total number. There will be about 50 ships, of which eight will be in the standby squadron, but there will be no ships in major mid-life modernisation. I wish to say more about this important matter.
Annex I of the dockyard study points out that a short life destroyer/frigate fleet, which is what I propose, without expensive mid-life modernisation—I hope that the hon. Gentleman is following me—will have a higher availability of about 12 per cent. than a long life fleet of the same size. It shows that a smaller short life fleet of equivalent operational availability will be marginally cheaper, though considerable reductions in dockyard load will be possible, and that the military work of a short life fleet will be slightly higher, since ships will be more modern. This study is available to be seen.
My hon. Friend the Member for Ashford will immediately remind me that the conclusions against a short life fleet reached by his study were based on the


assumption that the size of the surface fleet must be kept at its planned level and that the resources must be made available to build new ships under the policy.
I have made provision, with additional sums of money, for the acceleration of the building programme of the new type 23 frigate. We are also examining urgently much cheaper types of ships for multiplying towed array and inexpensive helicopter platforms. I believe that we can get designs settled and orders placed more rapidly than has been the case in the past with new ships. I shall be taking a personal interest to ensure that my Department and British Shipbuilders work together to get the orders into the yards as quickly as humanly possible.

Mr. R. C. Mitchell: Will the Secretary of State say in which year he expects the first type 23 to come into service?

Mr. Nott: On present plans, the first type 23 will come into operational service in about 1988. That is the approximate year, because of the length of time that it takes to design these ships and build them. I have made the point that we are looking to a fleet of 50 escort ships, as against 59 at present.

Mr. Robert C. Brown: Will the Secretary of State say when the next orders go into the shipyards?

Mr. Nott: The hon. Gentleman is naturally concerned about shipyard orders in his part of the country, as I am. Had I not made the changes, there would have been far fewer shipyard orders than will now be the case. The resources would not have been there to build new ships. I am not seeking to make a controversial speech. However, on the kind of proposals made by the hon. Gentleman's party, which involve a reduction in defence expenditure, so far as I can judge, of about £3,500 million a year, there could not conceivably be a penny over to build another naval ship.

Mr. Brynmor John: As the right hon. Gentleman's estimate has gone down by £1 billion since his defence Estimates speech, will he get the MOD to give consistent figures?

Mr. Nott: The hon. Gentleman, as usual, was not listening. I have used a figure of £40 billion. I was referring to a different figure.

Mr. Julian Amery: Will my right hon. Friend clear up one point about the ships? There is a widespread view, to which he has just given some credence, that we are to come down from 59 ships to 50. However, if one considers those put to reserve—I gather that it will he a month or more before they can be activated, and my right hon. Friend has spoken about the dangers of the broken-back war—are we not talking about coming down from 59 minus 3, which is 56, to a figure of about 32?

Mr. Nott: If my right hon. Friend wants to isolate the ships in the standby squadron and put them on one side, the comparison on that basis would be 56 ships, because three are in the standby squadron at the moment, with 42 in the future. The point that I make again is that this kind of simple comparison cannot be valid. By ending a process of mid-life modernisation we shall not have the same number of escort ships undergoing major modernisation and refits in our yards. I accept that it is a smaller surface

fleet. However, the smaller surface fleet will have higher operational availability than the present larger fleet. I commend the dockyard study to my right hon. Friend.

Mr. A. E. P. Duffy: I do not doubt that the Secretary of State hopes that he will be able to continue assigning at least 50 ships to NATO, given our Eastlant and Channel commitments. Even if his faith in the SSN and the MPA, as well as barrier operations, is borne out, is he aware that, given what he has said about the volume of reinforcement and resupply material that will possibly have to be defended, there is no analyst who is thinking of figures of escort vessels as low as those that are undoubtedly in the mind of the right hon. Gentleman and also in the minds, I presume, of many hon. Members on both sides of the House. We can discount his 50. It will be well down even into the 30s.

Mr. Nott: Of course I want to see more escort ships. If we had the resources, I have no doubt we would put some of them into the building of more frigates and destroyers. Even on a 3 per cent. real increase during the next four years—and that is not the proposition that the hon. Gentleman is advocating as a member of the Labour Party—we must find the resources from somewhere. I would rather find them out of the supporting infrastructure than out of the front line. If that is the right decision to take—most of my hon. Friends agree that that strategy is basically right—a consequence will be that we must go out of mid-life modernisation and have a slightly smaller operational fleet. That is how we arrive at that position.
By accepting a rather smaller surface fleet, we should be able to obtain the benefits of higher availability and slightly greater military worth—as outlined in the report—and a great saving in dockyard support.

Mr. Neville Trotter: If there is to be a force of 50 frigates and destroyers with a life of 15 years, there must be a building programme averaging between three and four frigates a year. Will my right hon. Friend confirm that that is how he views the matter?

Mr. Nott: I accept that there will come a time in the 1990s when some of the existing surface fleet will no longer be fit for operational purposes. Therefore, it is important that we initiate an active shipbuilding programme in the next few years to avoid a gap opening in the 1990s. That assumes that we wish to keep the total number of ships at 50.

Mr. R. Bonner Pink: Does my right hon. Friend accept that Sir John Rix, the chairman of Vosper, is willing to design a type 23 frigate from scratch in seven months?

Mr. Nott: If Sir John wants to visit me tomorrow with his plans and designs, he will receive a most hearty and warm welcome from myself and my ministerial colleagues. It appears to be precisely what we are trying to attain. We want designs for a simpler and cheaper general purpose frigate which we can build in sufficient numbers and give to the yards during the next few years. It is not possible to continue to spend £70 million on each Leander frigate, modernising it as we are, and at the same time have the resources—[Interruption.] I note that my hon. Friend the Member for Portsmouth, South (Mr. Pink) has left the Chamber. I apologise to him in his absence.


I have to be in Warrington tomorrow. Perhaps one of my hon. Friends could suggest to him that Thursday would be a better day. We could deal with the matter on Thursday.
The next genuine matter of concern has been expressed to me by my hon. Friend the Member for Faversham (Mr. Moate) and others of my hon. Friends. It concerns the capacity in Devonport and Rosyth to carry forward the larger nuclear submarine refitting programme envisaged in my statement.
Experience of the performance and durability of submarine equipment and materials and the introduction of longer life cores for their reactors now make it possible to plan for the extension of refit intervals by 10 per cent. for older boats and by 20 per cent. for the new Swiftsure class of submarine. In addition, one of the three intermediate dockings for the nuclear submarines is being discarded, although there will be intermediate docking periods for testing and examination to ensure that the highest standards are maintained.
It is not possible to judge the feasibility of the new plan by simple arithmetic based on the number of so-called streams available in Devonport, Rosyth and Chatham. Having two streams does not mean that submarines enter the refitting complex two by two, like animals entering the ark.
Prior to the defence review, Devonport's programme provided for an accelerating SSN refit with start dates initially at 16 months, closing gradually to 12 months, down to 10 months. The options for a rephasing of the nuclear refit programme have been restricted to a relatively small expert team in the Ministry of Defence in London and in the dockyard department in Bath.
But I am assured that with the new facilities already available at Devonport, as a result of expenditure already made there of £85 million, and further support facilities already in the pipeline, the increased work load can be handled in Devonport and Rosyth. It will, however, need an increase of numbers at Devonport of about 1,500, some of whom will be transferred from Chatham or Portsmouth.
I must ask the House to accept that the Government, and I personally, will do all that we can to ensure that those changes are effected with the minimum hardship. They are to be implemented over a number of years. There will be redundancies among the civilian force, and also in the Services, but they will be kept as low as reasonably possible.
My hon. Friends and I are now examining urgently the consequentials of the broad decisions explained in the White Paper and will be working with all concerned to ensure that they are achieved with the greatest understanding of their impact on employment and on localities.
In particular, I have drawn the attention of my right hon. Friends in other Departments to the needs of the situation. Proposals put to me, for example in respect of the release of land at Portsmouth, are under consideration by my right hon. Friend the Secretary of State for the Environment and myself. As soon as I can be more specific about land at Portsmouth, I undertake that I will put forward proposals.

Mr. Roger Moate: Does my right hon. Friend accept that no matter what figures he puts forward for optimistic gaps in servicing and refits, at any given

moment he will have three nuclear submarines undergoing major refits? Without Chatham, there will not be the capacity to carry through refits of that order. Will he accept that not one major refit has yet been completed at Devonport? The only vessel there undergoing refit is now in its third year, and is likely to be in its fourth year before it finally emerges.

Mr. Nott: I cannot accept that. In the last resort I have to accept what my advisers tell me on this highly technical and complicated question rather than rely on the opinion—which may be genuinely and sincerely held—in Chatham. I have a great range of advisers on this matter, primarily in Bath—[Interruption.] There may be too many of them in Bath. That is a seperate question.
I understand my hon. Friend's concern. It is an important point. If he wishes to discuss it with my Department—the Select Committee may also wish to discuss it—we can hammer it out with the experts. Obviously, the last thing in the world that I seek to do is reduce our nuclear refitting capacity to below what is needed. I assure my hon. Friend that is not my objective.
I have spent some time on the dockyard reorganisation because it affects so many of my hon. Friends, and in a most distressing way for their constituents and themselves. In general, criticisms that I have received from my hon. Friends, with only one or two exceptions, are not directed at the overall strategy. I think that it is broadly accepted that we could not pull any bricks out of the supporting arch of NATO by withdrawing from our present commitments on the central front. Some of my hon. Friends think we should have spent more money going beyond the 3 per cent. increase.

Sir Frederick Burden: My right hon. Friend has said that the first type 23 frigate will probably come into commission in about 1988. It is proposed to run down Chatham and greatly to reduce Portsmouth by 1984. It appears that there will be a considerable gap for the repair and refit of vessels during that period. It seems that there will be at least a dip in our surface fleet, and a considerable dip, at that time, which I consider to be a great risk.

Mr. Nott: I assure my hon. Friend that we are doing our best and that we shall continue to do so. We believe that it is possible to maintain the number of escort ships at about 50 throughout the 1980s. That is what we are saying, and that is what we shall do. The number will not be constant. It will diminish from 59 over a period of years.
With the increasing cost of defence equipment, which has been accelerating far more rapidly than the general level of inflation, and beyond the increase of 3 per cent. in defence expenditure, it was necessary to look to major savings in manpower, both Service and civilian, at all levels.
I wanted to retain the vast range of new technology systems in British industry to enhance the front-line capability of our forces, and there was nowhere else to look but in the supporting infrastructure. Thus, quite apart from the dockyards, we have proposed substantial changes in the infrastructure of the Army. I shall not go into that now, because of the shortage of time.
Finally, some commentators have suggested that because we have no choice but to modernise our strategic nuclear deterrent, as the Labour Government did before us with the Chevaline programme, we are in some way


lowering the nuclear threshold. In fact, the opposite is true, as a large part of the extra funding proposed by the Government has gone into considerably raising the staying power of our conventional front line, thus raising the nuclear threshold in Europe.
If a new Labour Government—the hon. Member for Pontypridd (Mr. John) might bear this in mind—abandoned our nuclear deterrent and actually reduced defence expenditure to the European NATO average, which involves spending about £3½ billion a year less on defence, it would inevitably undermine the arch that supports European conventional strength. That really would enhance the dangers of nuclear castastrophe, because it would bring a trip-wire strategy much closer.
The Opposition cannot have it both ways. Either they maintain our conventional strength, which keeps up the nuclear threshold, or they take the opposite course and reduce defence expenditure, which must inevitably lower the nuclear threshold. The proposals in the White Paper are simply that Trident will cost, on average, in the next three years about £200 million, against a defence budget of £12,500 million. It is true that in the late 1980s Trident expenditure will rise to about 5 per cent. of the defence budget and 10 per cent. of the equipment budget, but so what?
Common sense tells me that with the Soviets possessing a vast armoury of nuclear and conventional weapons capable of dealing a massive blow at the United Kingdom homeland, it is wise for the United Kingdom to retain itself and within its own control the only weapon system that enables us to retaliate at the Soviet homeland.
Trident may represent in striking power only around 3 per cent. of the Soviet strategic force, but it is none the less very real for any future potential aggressor in the Kremlin, for with one submarine we retain the capacity to strike at well over 100 separate targets over a vast area of the Soviet Union.
I have never suggested that the first argument for Trident is that we need to be able to take out 100 targets, 200 targets or two targets. For me the foremost argument is that we must have a weapon system that is invulnerable against pre-emptive strike, and one that as far as we can judge will survive as a credible weapon system for 30 years. Soviet anti-submarine warfare technology is bound to improve and it is the range of Trident, of up to 4,500 miles with massive sea room in which to hide, that provides the key element of invulnerability and, therefore, of the ultimate capacity to strike back if anyone ever strikes us first.
Secondly, by buying a proven missile system already in production we are limiting the risks of escalating costs. We did this with Polaris and there was no cost escalation whatsoever from the final estimate of cost. It came out at exactly the figure proposed. With Trident we are not going into unknown areas of R and D, which is where the escalation normally comes.
Thirdly, 70 per cent. of the Trident expenditure would be procured with British industry anyhow. If we did not build nuclear submarines for Trident, no doubt we would build four additional submarines for the enhancement of our hunter-killer submarine fleet. This would be useful if we could afford it, but where is the massive saving to be made here?
Where is the massive saving of having- four hunter-killer SSNs with Sub-Harpoon on them rather than four SSBNs with Trident on them? Does the Labour Party

intend to close Vickers at Barrow to take us out of this technology altogether? Where are these massive savings? They will not be made unless we close Vickers at Barrow and come out of the business.

Mr. Clive Soley: rose—

Mr. Nott: There is no lack of debate on all these issues. We have published a White Paper. This is the third major debate in the House in the past few months. The Select Committee has reported. It is not a lack of debate but a failure on the part of the critics to win the argument that really rankles. There is plenty of debate, but the critics do not win the argument. The proposals in the White Paper have been framed so as to enhance Britain's contribution to the defensive forces of the Atlantic Alliance.
I ask the House to support the maintenance of sound and secure defences and an increase in expenditure for that purpose, and to endorse a continued hard-headed appraisal of how the defence budget should best be spent to ensure the maximum hitting power of our forces and, therefore, the maximum deterrent. I ask for the support of the House so that the United Kingdom may maintain and enhance its central contribution to the maintenance of peace in Europe.

Mr. Brynmor John: My first reaction both to the statement on which the debate is based and to the Secretary of State's speech is that a conjuring trick has been performed which did not reveal the whole truth and which was designed to conceal as much as possible of what the Secretary of State has done. I shall ignore the Keystone cops episode when the hon. Member for Wirral (Mr. Hunt) was chasing the hon. Member for Portsmouth, South (Mr. Pink) towards the nearest telephone. All that I have read and all that has happened since confirms my initial estimate.
The basic necessity for a consideration of what is on any view of the subject a basic change in direction by the Government is that we should have all the facts clearly and concisely before us so that we may debate what has happened and the implications. It is a measure of the smokescreen that has been created by the White Paper and its convolution that a good deal of the debate has already been taken up with attempting to ascertain the precise nature of what has happened. I suspect that a considerable amount of the time that remains for debate will be devoted to that purpose.
There is one great difference between the White Paper and its predecessors. At all stages, the Conservative Government have been saying that their aim is to have a thorough and informed debate among the population about defence because at the end of the day the population has to pay for defence. I refer to page 93 of the 1980 White Paper and page 1 of the 1981 White Paper. No such sentiments are expressed in this White Paper, and I am riot surprised.
I suspect that there are many, not least those in the press—I am sorry to strike a raw nerve with the right hon. Gentleman—who are interested in the financial implications of the White Paper.
The Secretary of State said that he is increasing spending by 3 per cent. and that that is the end of the matter. That is the truth, but it is not the whole truth. He would have been wise to reveal it without its being forced


out of him. The House of Commons approved the defence White Paper "Defence in the 1980s"—indeed, all the right hon. Gentleman's hon. Friends voted for it—and the Trident White Paper, with all its volume implications. That laid down certain volumes of expenditure for defence over the coming decade, which have now been cut by this White Paper. Therefore, the House and the country would like to have known the difference between what it would have cost to fund that volume of expenditure compared with what it will now cost to fund the reduced volume.
The Secretary of State has made a remarkable contribution to the informed debate. In the Financial Times, he is reported as saying that the Government had never produced figures of long-term costings and that they would not do so now. He said with truly breathtaking commitment that he was not in favour of that kind of open government. One must therefore ask what type of open government he is in favour of.

Mr. Nott: Not much.

Mr. John: That is quite apparent, because the White Paper spreads facts pretty thinly around.
When the right hon. Gentleman made his original statement, I asked him a question to which I have not yet had an answer. He said of his plans:
This may mean that defence absorbs an even greater share of our gross domestic product".—[Official Report, 25 June 1981; Vol. 7, c. 387.]
I am still waiting for the answer to my question, which was how much greater a share of GDP it is likely to absorb. The Secretary of State and the whole Conservative Party know that whatever noises they may make this afternoon, this will simply not be worn by the Treasury. That is why I believe that today's statement is probably only an interim one.
It has all the feeling of an interim statement. It would not surprise me a bit if the right hon. Gentleman had a team in the Ministry of Defence even now working on a further package, either for the same period or for later in the decade, to be brought before us in the autumn. This is an interim package, and by no means do I believe that it is the definitive statement which the right hon. Gentleman has pretended it to be.
Nor could one get out of the right hon. Gentleman the whole truth about the Royal Navy cuts envisaged in the original statement. Never was the right hon. Gentleman's conjuring skill seen to better effect than when he stated that the number of ships declared to NATO would be reduced from 59 to 50. During the questions that followed that statement, the hon. Member for Ashford (Mr. Speed) said that that meant the scrapping of 20 frigates and destroyers. It transpires that the right hon. Gentleman's figures mean that 50 equals 42, because we are talking about a fleet of eight in mothballs.
When we consider the implications of the virtual closure of Portsmouth dockyard, it is inconceivable that the eight ships in the reserve fleet will be worked up within the period of 30 days for which they are committed. We are also talking about a smaller fleet. My hon. Friend the Member for Sheffield, Attercliffe (Mr. Duffy) has already given certain figures that have been seriously discussed in the press and elsewhere about the actual size of the fleet.
The right hon. Gentleman talked about the reduced necessity for mid-term modifications. But ships must go

in for repairs as well as for major mid-term modifications. I understand that at any one time eight ships from the present fleet are in dock for refits and eight are working up. I accept what the right hon. Gentleman said about being unable to extrapolate a smaller fleet, but in crude figures one is talking about 26 ships. Even if one were talking about a smaller number, one would be talking about an active fleet, ready for action, of about 30 ships.
That may be right and proper and it may be a judgment that should have been made. My point is that it should have been made frankly and not with the blandness with which the House was treated on the previous occasion, when we had to ferret out the facts from the Secretary of State and extract figures almost as one would extract teeth, but without the injection that goes with that process.
We must also examine the alternative naval strategy proposed in the White Paper. Apart from the remainder of the surface fleet, the right hon. Gentleman relies for antisubmarine warfare upon a combination of hunter-killer submarines plus the Nimrods. I think it is common ground that if that is to be the strategy for the future, it is absolutely essential that the naval building programme is geared to the establishment and maintenance of the SSN fleet. As the right hon. Gentleman has told us, these submarines, like the Trident ships and the diesel submarine, will be built at Vickers in Barrow. [HON. MEMBERS: "Not the diesel submarine."] I accept that correction, but certainly the Trident ships as well as the SSNs will be built at Vickers.
At present, we have a fleet of 12 SSNs. The right hon. Gentleman announced in his statement that by 1990 we would have a fleet of 17 SSNs. Once more, he told us the truth, only just the truth and not the whole truth. He chose his date well, because if we carry on building hunter-killer submarines up to the year 1990, we will have a fleet of 17. However, the building programme for the hunter-killer submarines will be interrupted by the building of the four Trident ships, which will continue for about seven years. During those seven years, five of the hunter-killer submarines will pass not merely their 20-year life—which British Shipbuilders has said is the maximum life for hunter-killer submarines—but also their 25-year life. Therefore, they will be decommissioned on the ground that they have exceeded their age.
By the mid-1990s, the linchpin of our new conventional maritime effort—the hunter-killer submarine—will have been reduced in number to the 12 that we have at present. As a result, there will be a complete hole in our antisubmarine warfare strategy. Once more that is evidence that the Trident programme will create a desperate weakness in our conventional effort.
The Secretary of State referred to the Service cuts, but I appreciate that because of shortage of time he did not mention them in any detail. Nearly 20,000 reductions are due to be made, of which 9,500 will be made in the Army and the RAF. At present, we have absolutely no details as to the ranks and trades that will be affected, and there should be an early mention of them.
The main loss will take place in the Navy. I hope that more detail will be given about where those cuts will fall and that something will be said about the paramount need to maintain a proper career structure within a smaller Navy. There is no doubt that sea service for officers is becoming less possible. I hope that the experience of naval officers will remain relevant and active.
I now turn to the likely civilian consequences of these cuts. We were given no details about the likely effects of these cuts on the shipyards and on the corporate plan of British Shipbuilders. The future of three yards has been called into question in the press—Swan Hunter, Cammell Laird and Vosper Thornycroft.
The right hon. Gentleman fairly mentioned in his statement that he proposed to order certain new ships. There is a difference beween announcing that to the House of Commons and actually placing those orders with the shipbuilders. If he relies on the maintenance of a skilled work force to build those ships and to deliver them on time, he must place the orders with those shipbuilders in the next month or so. I hope that either he or the Minister of State will tell us during the debate that such is the Government's intention. I am bound to tell the Secretary of State that, for all his brave talk about keeping the fleet up to standard and so on, there is a slight variation in the facts. The diesel submarine order will not be placed until 1983 because it cannot be afforded until then. I beg leave to doubt whether his careful phasing of the shipbuilding programme will be as careful and free from budget pressures as he appears to say at the moment.

Mr. Duffy: Does my hon. Friend recall that during his statement, in reply to a question by the hon. Member for Isle of Wight (Mr. Ross) about Cammell Laird, the Secretary of State for Defence said that he would make a statement about Cammell Laird in this debate? However, he has not even made a reference to that firm.

Mr. John: I remember that. On the other hand, the Secretary of State was somewhat blown off course by the frequency of interruptions. I do not blame him for not having made a statement in an otherwise comprehensive speech. I hope that the Minister of State will answer my point and make it clear what the future is for Cammell Laird and other shipbuilders.
Decisions are at their most drastic in the dockyards, with the complete closure of Chatham and the cut in Portsmouth. All we have heard about the Portsmouth dockyard is that it will be severely reduced. I understand that what is proposed is a cut in the work force from 7,400 to 1,200. The Minister of State should confirm that, in fairness to the area. That is the figure which representatives from the area have been putting to us this week.

Mr. Cyril D. Townsend: Is it not a fact that the Royal Navy has been reduced by well over half in the last 10 years? It is absurd to think that we can continue to keep the same number of dockyards with their vast and extravagant overheads in 1981. Will not the hon. Gentleman admit the reality that the Labour Government considered the possibility of closing dockyards, but because of political consequences they decided to duck the issue?

Mr. John: I have never thought the maintenance of employment as a political ploy to be unpraiseworthy. The hon. Member for Portsmouth, North (Mr. Griffiths) said "Vote for Griffiths" to extend the lease of life of Portsmouth dockyard. It was the shortest extension of a lease since shorthold tenancies were imposed by the Government.

Mr. Peter Griffiths: Will the hon. Gentleman accept that that was said in full sincerity and was believed until last August?

Mr. John: Of course that is so. I am not trying to arouse sedition on the Conservative Benches, which are normally more noted for their threats than for their delivery. I hope that the hon. Member's actions at the end of the debate will follow the promises that he made to the electorate of Portsmouth, North when he contested that election.
The effect on the dockyards must be judged by two criteria, as the hon. Member for Bexleyheath (Mr. Townsend) mentioned. The first is the defence judgment on which the decision is based. I have mentioned the implications which the closure of Portsmouth will have for the reserve fleet and for the ability to make ready within 30 days the eight ships which are placed in the reserve fleet.
The more fundamental question, which comes back to the question of the hon. Member for Bexleyheath, is, what do the Government expect Portsmouth dockyard to do when its labour force is reduced to one-sixth of its former size? In dockyard terms, is it not the equivalent of putting that dockyard on a care and maintenance basis? If so, can we afford it and should we be able to afford it for the defence of this country? The Secretary of State has said that that is right and that it should be done. However, we should bear in mind that Portsmouth will be able to undertake little with a work force of one-sixth its present size.
The Minister has said that he has advisers on the subject of Chatham. I accept their expertise. However, I also accept the expertise of those who have spent a great deal of time—indeed, their whole lives—in practical shipbuilding and in the relevant expertise which we are now discussing. What we are advising—

Sir Frederick Burden: Surely it must be accepted that Chatham was the first establishment to have two nuclear streams. It has produced a considerable number of vessels as a result of refuelling and refit. It has the experience of knowing what the problems are. Surely that is often much more effective than the advice of boffins sitting in chairs.

Mr. John: The words of such people must be taken seriously. As the hon. Member said, Chatham has refitted SSNs both to time and to the cost which has been given to the dockyard. It has a capability for twin streaming. I am not sure whether Devonport yet has that expertise, but I am sure that it will acquire it.
Are the Government satisfied that our refit and repair capability—and, most importantly, our nuclear refuelling capacity—will be sufficient to look after a fleet of hunter-killer submarines which the right hon. Gentleman says will be enhanced by 1990? At a time of low morale, rumours are going about. The rumour in Chatham is that if the refit capacity in the rest of the yard does not prove sufficient, the boats may be destined for United States yards to be overhauled there. I hope that he will take the opportunity to deny that, because we would find it intolerable.
The second criterion is the human implications. That part of the judgment seemed low on the Secretary of State's agenda. The Secretary of State and the whole Government have a direct concern with that not only because they are the employers of the men who work in the dockyards—again this is partly an answer to the question of the hon. Member for Bexleyheath—but because the work forces were promised, in the dockyard review by the hon. Member for Ashford about 10 months ago, that four dockyards would remain open.
Secondly, the Government have a special responsibility because of the words of the Prime Minister when she went to Sunderland—and who better will remember those words than the right hon. Gentleman? The Prime Minister said that people must be prepared to move to work and that they could not stay in other regions and expect the work to come to them. Emissaries went out from Chatham to Sunderland in December 1980. The advertisement in the local newspaper at that time read:
Start the new year with a new job at Chatham, Kent. H.M. Dockyard, Chatham, with its full programme of work stretching in the foreseeable future, offers secure employment to craftsmen required to keep Britain's warships fighting fit and ready for action.
The people who took up employment pursuant to that advertisement, not surprisingly, feel bitter and irked with the Secretary of State for having betrayed them in that way.

Mr. Keith Speed: May I put the record straight? The hon. Member for Pontypridd (Mr. John) referred correctly to the undertaking that I gave to my hon. Friend the Member for Rochester and Chatham (Mrs. Fenner) in the House in August last year. He will understand that that was not a personal whim. I was giving an undertaking on behalf of the whole Government. It had been discussed at the highest level by the Government on the basis of the fleet then in being, following the dockyard study to which reference has already been made. I wish that to be clear, because it has been suggested that it was a personal whim of mine. It was nothing of the kind.

Mr. John: Nobody who knows the hon. Member for Ashford would dream of saying that he was doing anything other than fully reflecting the Government's attitude. All that I am saying is that if there was a need to give that assurance 10 months ago, the point made by the right hon. Member for Sidcup (Mr. Heath) about the historical rundown of the dockyards is fallacious. The need cannot have changed so much in 10 months.
The Government have a special obligation to apprentices. Chatham has 700 apprentices. It takes in about 160 a year, or a quarter of all the apprenticeships granted in the Medway area. Portsmouth takes in about 200 apprentices a year. It is nearing the completion of an apprentices training centre at a cost of £2¼ million.
What will happen to the apprentices? What will happen to those who are in mid-term when the axe comes down? Chatham is to be closed in 1984, so we cannot believe that the phasing out is to be so gradual that everybody employed there will serve all his time. What effort will the Government make in the areas to attract alternative work or to set up other projects?
We have heard formal regrets and seen hand wringing by the Minister. The people in those areas want more than that. They feel let down by the Government. They feel that no monetarist diktat should stand in the way of the Government making a major effort to absorb the unemployment resulting from the White Paper. Are such people to be added to the pool of unemployment which is already running at 14½ per cent. in Chatham and at over 10 per cent. in Portsmouth?
I am sorry to return to my main theme. I know that it will irritate the Secretary of State. He becomes testy and dislikes being reminded of it. The real reason for the

wrigglings and agonisings is the squeeze on volume in the defence budget imposed by the necessity to fit in the Trident programme. [HON. MEMBERS: "Nonsense" .] Hon. Members will have a chance to say what they think later.
With every debate in the House the Secretary of State loses support for his strategy and for his delight in that project. The right hon. Member for Sidcup shakes his head, but the day after the statement on the White Paper the Daily Mail got off the bandwagon. That must have been wounding for the Secretary of State, who had already been goaded by the indifference of The Daily Telegraph into a bitter attack upon it. The Secretary of State realises that the Prime Minister will not allow him to make an attack on the second of the Tory Party trinity.
The Secretary of State's defence of Trident is a set of assertions about the uniqueness of the deterrent. It is not really an argument. The somewhat guarded support from the loyal majority in the Select Committee does not compare with the excellence of the minority report.
The Secretary of State seems to think that to weaken conventional capability and to keep Trident in the programme would heighten the nuclear threshold. Everybody else who speaks the English language, whether it is his first language or not, believes that it lowers the nuclear threshold, to the danger of the world. That is what the Leader of the House said when he was Defence Secretary. I am not surprised that on this fateful day for his past ideas he is not on the Front Bench to listen to the debate.
The nuclear threshold will be lowered as a result of the Secretary of State's decisions. It is no good pretending that that is not so. The deadly grip of the Trident project on the defence budget will tighten as time passes. We shall be faced with repetition after repetition of this debate until we realise that we cannot combine an acceptable level of conventional armaments with the Trident programme.
For the edification of the Secretary of State I shall declare myself. In such a competition I favour NATO's priority—conventional armaments. The Secretary of State says that that involves £5,000 million. He says "Even if I am not the iron Chancellor, I am the iron Secretary of State for Defence and I shall keep expenditure rigidly under control." With every week that passes, that pose becomes more and more incredible.
The failure of the Chevaline programme affects not only the Polaris programme. It calls into question our ability to do the work for the warhead of the new missile in the time and, more importantly, at the cost first quoted. The quotation for the Polaris weapon is false and the Secretary of State knows that. About 88 per cent. of the development work on the Trident project is to be done in Britain and escalation in costs is certain.
There is no decision on the type of Trident missile that we are acquiring. The Secretary of State said today that we are buying a proven system. Is he telling the House that we are buying the mark I version of Trident or that we are still to consider the mark II version? He was going to announce the decision on which version to buy before the end of July. I understand that that is put back until the autumn. If we buy the mark II and have commonality with the United States, £750 million will be added to the cost of the project.
Not for the first time, the Secretary of State pretends that Trident is merely an updated system in line with Chevaline. That is nonsense. We are talking about a new generation. The Labour Government were not committed


to a new generation of nuclear weapons. I hope that the Secretary of State will not foist that argument on us again. Our plan was to update the present version. Trident moves into a new generation.

Mr. Cranley Onslow: Will the hon. Gentleman give way?

Mr. John: No, I will not give way.
We are asked to approve the Secretary of State's White Paper. It is the Secretary of State's latest, but not his last, version of his tactical appreciation of the situation. We shall return to it. I have queried the White Paper on its own terms. I find it to be faulty in reasoning, incomplete in strategy and totally mysterious in arithmetic. It is a party political attempt to dress up a retreat from the Government's position as if it were an advance.
Until the Government accept and admit the true budgetary restraints and take the House into their confidence about them, we shall have neither a proper nor an informed debate. The right hon. Gentleman sought to be a conjurer of epic proportions. He ended as a political Tommy Cooper with White Paper all round him as a testament to his failed tricks. It is a White Paper that we cannot and will not support.

Mr. Edward Heath: In what I hope will be a short intervention I shall deal with two main points.
The Government and the Secretary of State in the White Paper have rightly emphasised the importance of a defence strategy to which our defence forces are committed. It is unfortunate—it has been unfortunate under many Administrations—that when we debate defence White Papers and changes in either strategy or forces, it is done not because circumstances have changed and a fresh approach to strategy is required but because of financial circumstances which require a change in the financing of the forces and the resources available to them. The consequence is that we tend to give less attention to the basic strategy to which our forces should be adapting than to the particular problems which arise out of the financial circumstances and the changes which are brought about. That is perfectly understandable.
I listened with great sympathy to what my hon. Friends said about the dockyards. I must declare an interest as some of my constituents work in the Chatham yard and, for a variety of reasons, I am personally acquainted with all three southern yards as well as those in the North. Therefore, I have the greatest sympathy with them and I understand this matter, although I wish to raise some points with the Secretary of State about it.
To return to the question of strategy, the Secretary of State in the White Paper rightly emphasised the importance which attaches to NATO. My doubt is about the effectiveness of the forces in the strategy in the rest of the world, which he briefly described in the White Paper and of which he spoke today. The Caribbean is a dangerously explosive place, but the United States is only a few miles away and Canada has always had a great interest in the Caribbean. The Falkland Islands are unlikely to cause a major explosion. The main area that is crucial is the Gulf.
In reading the White Paper, I therefore ask myself whether the forces described there will be of sufficient strength and of the right composition to deal with strategy

in the Gulf as well as with NATO. That is bound to apply particularly to the naval forces. I express doubt whether the Secretary of State has yet convinced the House that the new arrangement for the naval forces will give them sufficient strength to look after NATO, to look after the Western approaches in case of need and also to be available, especially in the next decade, if there is trouble in the Gulf. I believe that it is to the Middle East that most of us look at present rather than to the problem of Soviet Union penetration in or conflict with Western Europe.

Mr. Alan Clark: I am sure that many Conservative Members would agree with the substance of what my right hon. Friend has said so far, but did not the Government of which he was Prime Minister withdraw Britain from the Gulf?

Mr. Heath: With respect, the Labour Government of 1966–70 gave the undertaking to withdraw from the Gulf. That could not be reversed. As Leader of the Opposition, I made a tour of the Gulf in 1968 in an endeavour to persuade the Shah of Iran and the rulers in the Gulf to enable us to reverse the policy if we were elected at the next general election. They said that they were sorry, but the decision had been made and they had their own plans on the basis of Britain withdrawing from the Gulf. Moreover, the United States Administration at that time were in sympathy with the Labour Government and not with the Conservative Opposition. The American Administration were therefore telling the Gulf rulers, as well as the Shah of Iran, that they must take responsibility for the Gulf. That was when the great build-up of the Shah's forces began. Although I am now accustomed to attacks on the Government of 1970–74 for every conceivable mistake, this happens not to be one of them.
I therefore ask the Secretary of State, when he considers these programmes—he is bound to consider the programmes of shipping redundancy and so on regularly, not just on this occasion—to bear in mind that we may urgently need naval forces based in the Indian Ocean which can be effective in the Gulf and can work with United States forces. I know of no other European force which could operate there. I do not think that the French are capable of doing so. Therefore, the responsibility falls to us in this area of strategy.
The next point tied up with strategy relates to the dockyards. As the Secretary of State said, we may be called upon at urgent notice to use the standby part of the fleet. That requires quick refitting in yards and quick assembly of crews. May we be absolutely assured that the remaining capacity will be able to do that in time of urgent necessity, either for the Gulf or for the Western Approaches? I express my doubt in this respect and ask the Secretary of State carefully to consider whether, at the rate at which he is dealing with the dockyards, they will be capable of dealing with this problem at any time during the next five years. It is absolutely crucial to the naval defences and to our activity strategically with NATO, the Western Approaches or in the Gulf.
The Territorial forces have not so far been mentioned. Here, again, I have to declare an interest. It is most welcome that the Secretary of State is prepared to increase the number by 17,000. I raise the further point, however, that the Territorial forces today expect to be fully and properly equipped with modern, up-to-date equipment. Unless the Secretary of State is in a position to do that, it


is better not to make the attempt at all. Those who join a Territorial force which does not have up-to-date equipment which they feel that they could use straight away in a modern battle will become disillusioned and discontented, and the impact on those already there will be of a kind that the Secretary of State would certainly not wish to bring about. I therefore ask him to ensure that the growing Territorial forces have the necessary equipment, instruction and resources. I realise, of course, that that means money.
My other major point ties in with what the Secretary of State said about having the will to carry this through and whether people today have that will. In my view, the will to carry through what the Secretary of State and other European Heads of Government want depends on a determination by Governments to show their will to bring about arms control. Unless Governments can do that, people will not be prepared to go on making sacrifices for defence forces.
I confess that I am alarmed, as I think that the Secretary of State indicated that he was, about some of the movements of public opinion in this country today, particularly perhaps on the nuclear side. The feeling of being against the development of defence forces has arisen particularly in the last two years. One has only to go to Germany or France to realise how much stronger that feeling has become there. When I went to West Berlin a month ago, I was greatly worried by the general feeling that I detected there about the ability or the willpower to deal with the Soviet Union. I am sure that this depends upon Governments showing that they will work with determination equal to that with which they produce defence forces to bring about arms control.
This, of course, includes nuclear arms as much as other arms. Indeed, nuclear arms may be first and foremost. On this point, I would say to the hon. Member for Pontypridd (Mr. John) and the right hon. Member for Plymouth, Devonport (Dr. Owen), who I understand is to move his amendment later, that I strongly support the Government in going for Trident. I have been in Governments who have had to make these decisions for a long time now.
Historians will continue to argue whether the original decision to go for Polaris after the breakdown of Skybolt was right. A strong body of opinion believes that this country ought to have joined the French to produce a common nuclear deterrent, which we could then have done with rationalisation and at a much cheaper price. That could still have been done in the late 1960s. I do not believe that it could be done now, because we have nothing to offer the French. They already have their own nuclear deterrent, which is quite independent of anything else. Therefore, we return to the question whether we simply continue with the present nuclear capability, let it run out and then become a non-nuclear Power, or renew with an American source—namely, Trident.
Nuclear submarines, as attacker submarines, are not replacements for a nuclear deterrent. The amendment suggests that if we abandon Trident and let Polaris run out, we can gain more nuclear attacker submarines. It suggests that that would be the better course. However, two completely separate questions are involved. One cannot make a decision on one, in connection with the other, on

a purely financial basis. Therefore, we must decide whether to remain a nuclear Power. The hon. Member for Pontypridd seems to take the view that we should not.
In the past 40 years one thing has remained constant among all the decisions that have been taken and all the views that have been expressed—namely, that when the Labour Party is in Opposition it expresses the view that we should become a non-nuclear Power, yet when in Government it has the ability to maintain Britain as a nuclear Power. That is the one consistent factor in history. After all, Mr. Attlee went for the nuclear option without the knowledge of Parliament or of his party. I do not criticise him for that. In 1964, the Labour Prime Minister fought the election on the basis that nuclear weapons should be abolished. However, when the Conservative Government took over in 1970, we found that they had not been abolished. The Conservative Government decided to modernise our weapons. The Labour Government carried out the modernisation and my right hon. Friend the former Secretary of State for Defence, now Leader of the House, announced its completion.
The hon. Member for Pontypridd, in good faith, said that the Labour Party did not want Britain to remain a nuclear Power. I have every confidence that in a decade or so, when the Labour Party is in power, it will carry on with a nuclear weapons policy.

Mr. John: The right hon. Gentleman will realise that I sought to make the point that Britain should not remain an independent nuclear Power. We are part of an alliance, in which our independent nuclear deterrent will be but a flea-bite. To pay for that nuclear deterrent, we shall have to subjugate our conventional contribution to NATO although NATO gives priority to conventional weapons.

Mr. Heath: The position remains as it has been since the Nassau agreement. In other words, our nuclear power is committed to NATO, except in the case of specific national danger. In that event, we are entitled to use our nuclear power. I cannot believe that a future Labour Government—given the Labour Party's abhorrence of internationalism—would refuse to have the national safeguard. Therefore, the argument becomes irrelevant, save in so far as it involves the purpose of nuclear weapons.
Nuclear weapons are justified because they give Europe a deterrent. With French co-operation in the Alliance, both the French and the British will have a nuclear deterrent. The issue is becoming more important because, as Europe's political influence in the outside world grows, the Soviet Union may see it as a growing threat. Europe will influence the rest of the world in a direction that the Soviet Union does not want it to go. As a result, the Soviet Union may try to separate Europe from America and to blackmail us. If we have a nuclear deterrent, both Britain and France will be able to reassure the rest of Europe that it will not be blackmailed. Therefore, we should continue with our nuclear deterrent and support Trident.
Many European leaders, particularly the Chancellor of the Federal Republic of Germany and the President of France, will find the utmost difficulty in maintaining solid defences within their countries. As we have seen, the German Chancellor will have great difficulty in finding acceptance for further nuclear weapons in Germany unless it can be shown that we are seriously negotiating for arms


control. At present, there is no sign of that. We shall not succeed if we try to link specific arms control negotiations with a host of other problems.
The first test ban treaty was signed in 1963. It has been observed and been of great value. It stopped air, land and sea tests. It was not linked with anything else. We did not say that the Russians had to behave if we had such a treaty. The non-proliferation treaty has also been valuable. Some people have got round it, but the major Powers have observed it. However, that treaty would not have been gained if it had been linked with all sorts of outside problems.
If there is an attempt—as I hope that there will be—to resume negotiations on nuclear arms control in order to get a further agreement on SALT II or to amend it, or if there is an attempt to control theatre nuclear weapons, it will not succeed if we try to link those negotiations with Afghanistan, Angola, the Gulf and so on. It is not part of the reality of power to tell the Russians that we are prepared to negotiate only if they behave in a way that we describe. We must deal with the problems one by one and settle them. If a fair and successful deal is achieved, it will benefit both sides. We should benefit from that just as we would have benefited from SALT II. If we would not have benefited from SALT II, President Carter should not have signed it.
Our first priority should probably be to reach an agreement about theatre nuclear weapons. Mr. Brezhnev wishes to achieve a settlement.

Sir Nicholas Bonsor: If an agreement were limited only to theatre nuclear weapons, would not the balance of interest lie with the Russians rather than with ourselves?

Mr. Heath: I do not accept that. We shall benefit if the agreement is properly negotiated, because Russian weapons are a threat to us. Until we reach an agreement, we must continue to build up our weapons in order to defend ourselves. That will place an enormous burden on Europe. However, it is already placing a great burden on the Soviet Union. It has enough problems, without wishing to increase them. Therefore, there are reasons for believing that Mr. Brezhnev would like to reach a negotiated settlement with President Reagan. Indeed, I hope that the American President will move quickly but will not try to cover the whole sphere of world affairs and to link that with all the problems that exist beween the two super-Powers as well as between Europe and the Soviet Union.
The Secretary of State is right to concentrate on strategy. I hope that he will ensure that we have all that is necessary to look after strategy, in the Persian Gulf in particular. In addition, I hope that he will ensure that the Territorial Army has the resources that it needs if it is to be successful. Although it is not my right hon. Friend's responsibility, I ask him to urge the Foreign Secretary to put all his energy and skill into helping our allies in Europe and the United States of America to negotiate an agreement on theatre nuclear weapons and subsequently on a replacement for SALT II, which was not confirmed.
If we can show people that we are determined to control the growth of arms and finally to reduce them, we shall gain support for the Secretary of State's policies. It is never possible to change the absolute balance by an agreement. However, we can prevent the balance from

becoming worse and the cost from growing. Finally, we can work to try to reduce it. If we do that, we shall have a successful policy for the defence and security that my right hon. Friend seeks and for winning the public opinion that is essential for it.

Mr. J. Enoch Powell: Until the intervention of the right hon. Member for Sidcup (Mr. Heath), there appeared to be a danger that this might become a debate about the subject, however important, of the future of the dockyards. It is a debate on defence policy and strategy.
The defence White Paper contains many decisions upon the rightness or wrongness of which the judgment must depend on technical and technological considerations beyond the knowledge of most hon. Members. It is even arguable that it is not desirable that knowledge of the ultimate and critical technical factors should be of wide diffusion. But all these matters are subject to, and derive from, the general policy and philosophy of defence. How nations fare in the ultimate test of war is more often decided by the thoughts, policies and philosophies which have inspired them many years before than by the weaponry that they may have chosen—though the one will often flow from the other.
The White Paper shows a realism and a cogency of analysis greater than those which preceded it, and my hon. Friends and I give it our general support. I do not expect that the Secretary of State has much leisure—I would be surprised if he did—to spend time reading the Hansards of the defence debates of the middle 1960s, but if any odd moment found him in that occupation he might be interested and might even be gratified to notice in those earlier years some approaches to the lines of thought which lie behind his own White Paper.
However, there are two qualifications—one of a minor nature, which has been touched on by the right hon. Gentleman, and one of a more far-going character—that I want to make.
In the defence debates of the middle 1960s, the great slogan, the notion around which most excitement centred, was what was called "East of Suez". The reason that time was probably the afterglow of empire—it was part of the process by which this country gradually accustomed itself to the alteration of its position and role in the world. Now both the Cheshire cat and the grin have gone, and yet there is a sort of after-grin in the White Paper in the section designated "Outside the NATO area". I do not think that it is still a post-imperial rictus: it owes more to occasional visits to Washington and to a tincture of the American mania, perhaps on the downgrade now, for intervention anywhere all around the globe.
If that section of the White Paper were meant seriously—if serious deductions were to be drawn from it for the character and composition of our forces—that would impose considerable distortion on our military effort and preparation. But hon. Gentlemen who read that section, while enjoying the expression
out-of-area flexibility of our ground forces
in paragraph 35, will note in paragraph 34 that since the conflict broke out between Iran and Iraq
a maritime presence has been maintained continuously
but that we were wise enough to maintain it
in the Indian Ocean".
The most important thing about the Gulf for this country is to keep out of it. We have virtually no sustainable power of operations in the Gulf, now it is no good hon. Gentlemen thinking that we can exercise influence unless we have the ability not just to tip and run but to win, whatever the circumstances of an intervention. That is also true of the United States, and I hope that it is a lesson that they are learning.
We have at last come home, in the sense that I think the White Paper is saying, and thereby gained the strength of singleness of purpose. There is now only one serious defence commitment with which this country is concerned. That is the defence of these islands in the North-Eastern Atlantic and whatever may be incidental to that commitment.
In considering the fundamentals of defence, the questions that we must ask are: what will be the decisive battle? And: what will be the means of winning it? In the last resort everything else in the thinking and preparation of a nation in peace time—above all, a nation such as ours, whose defence posture is essentially defensive and for which therefore the range of ultimate possibilities is far wider than for an aggressive nation—centres on those two questions: where is the critical struggle to fall and be decided? And: what are likely to be the means by which it will be decided?
The White Paper shows either that we have not yet posed those questions with sufficient precision and seriousness or else that the implicit answers to them are wrong. I found one phrase in the White Paper alarming:
the forward defence of the Federal Republic is the forward defence of Britain itself".
I do not believe that the crucial conflicts upon which the safety and existence of this country depend is the issue of the Continental battle. We place ouselves in mortal danger if we are content to rest upon the outcome of the Continental struggle the future of this country and the defence of these islands in the North-East Atlantic. Again, in the White Paper we are told that our function is,
with its full fighting strength … to guard the vital 65 km. sector assigned
to the First British Corps; and it is significant that throughout the White Paper the emphasis is on "front-line capability".
Those two characterisations hang together; for we are thinking in terms of an Armageddon of a few days' duration, the shock against the forward defences of NATO of an assumed attack, which would either be held—an almost inconceivable contingency as the aggressor is bound to be able to summon and organise the concentration that he requires at his point of attack—or would lead, after a relatively short time, to the taking of that unimaginable decision between surrender and suicide.
That nuclear scenario is irrelevant to the true justification for our retention of the nuclear weapon—the grounds given to the House by the right hon. Member for Sidcup were essentially the sound, fundamental grounds for our doing that—yet the nuclear scenario, on which NATO has lived for so many years, is in its fantastic unrealism the cause of profound distortion in our military preparations. It induces us to fall into the great error, for a country such as ours, of assuming that we have to put everything into the front line and that our preparations on

sea, in the air and on land have to be calculated—in time of peace, perhaps for decades ahead—to produce a specific front-line effort.
It is not in the first shock, it is not in the Continental struggle, that the final decision for this country—if there is to be war—will be taken. It is in the ultimate defence and impregnability of these islands in the North-Eastern Atlantic. The crux, therefore, is our ability, in all foreseeable circumstances, to command the air and sea above and surrounding these islands. That is the first imperative, it is the first assumption, from which our deductions need to be drawn.
If I may say so, the great merit of the hard and painful thinking that has been going on in the last few months in the Ministry of Defence is that we have concentrated, more, I believe, than ever before, upon the air-sea element in our defence—upon that perhaps empty sea where the decisive struggle is being fought in the air above and below the surface. If the price of attaining that defence is no longer to be able to maintain the type of surface fleet that we have maintained hitherto, it is a price that has to be paid.
One of the inbuilt dilemmas which the Secretary of State has had to face is the dilemma between effectiveness and range. Of course, there has to be both effectiveness and range. But, in the end, the two factors are in tension with one another. For a long time the Navy, the element of the Navy which, in the terminology of the White Paper, is the "platform" element, has sought range at the expense of effectiveness. I say "at the expense of because, in the end, in defence every cost is opportunity cost, and one thing is bought at the cost of another.
In the last resort, it is these islands that are the platform. It is these islands that are the aircraft carrier. Of course, we shall use all the resources of technology to extend the range of this aircraft carrier; but, it is here, where we are near to our home base and where our maximum concentration can be achieved, that we are most likely to succeed in winning the decisive battle for command of the air and sea upon which our existence depends.

Mr. Nott: The problem is that the right hon. Gentleman is missing out the cohesion of NATO. I should not dispute the military side of what he says, but, given that the possible aggressor has overwhelming conventional superiority over NATO now, I believe that in contemplating the defence of these islands—which is what he is concentrating on—we must realise that unless we play our part in holding NATO together, the Germans, Belgians, Dutch and so on will not be helping us to defend these islands, and that is the crucial political point to which perhaps so far the right hon. Gentleman has not devoted his attention.

Mr. Powell: The right hon. Gentleman's intervention illustrates an error into which those who practise humbug fall—they assume that although they are not deceiving themselves they are deceiving other people. In NATO we have all consented together to talk of what we do not believe. I do not imagine that any single element of the NATO Alliance takes what I call "the nuclear scenario" seriously, for all those nations, far more than the United Kingdom, have military histories of Continental war and Continental force on the Continent. These things are much more present to those who live on the mainland than they


are to us—to us Continental war is always at one stage of distance, to them it is the immediate reality, and they are not deceived as to the reality.
The reason why the Federal Republic of Germany does not field a larger force—the reason why its contribution to NATO is what it is—and why the relatively small scale of its forces is accepted by the nations of NATO is that they simply do not believe the Soviet threat to be proportionate to the Soviet forces. They believe there are inherent grounds for not expecting in present circumstances a Soviet assault. Of those grounds, in my opinion, the principal one is the determination of the Soviet Union not to be involved in a long war, above all a long war that would involve the United States.
So I am not neglecting the right hon. Gentleman's point. I am simply saying that, while we play this game, we should not allow ourselves to take seriously what no one in the end can take seriously—the notion, that is, that we are preparing to fight a five-day war and then either destroy ourselves or give in. That has not been the history of the great Continental conflicts, nor has the decisive part that the United Kingdom played in them been of that character.
I return to our maritime forces and the essential changes that the White Paper perceptibly makes in them. There is another very important one—still only a tendency, but none the less important. The right hon. Gentleman is inclined, on balance, to go for simplicity. He says "If by simplifying I can get more numbers, then I will do so." I know I am over-simplifying what I believe I detect in the White Paper; nevertheless, there is great wisdom in that. It is numbers that count at the decisive point and one cannot have maximum sophistication and maximum numbers. I believe that it was the American cavalry General Forrest in the Civil War who said "You have to get there the firstest with the mostest." Our chance of always winning the decisive battle for command of the air and sea around these islands is to be there "with the mostest", for whatever happens we are there anyhow the "firstest". In 1940 we did not have much; but we happened to have the mostest of what mattered.
Of course, if one is to have the mostest, one will not have it in peace time. What we must have is the capability of multiplying our forces within what is regarded as the necessary time scale. There, I believe, is the underlying connection between what is being proposed by the right hon. Gentleman in the White Paper and the industrial effort of this country. The potential to expand production of those items that will be essential in the earlier phases of a long war is the point at which our military preparations and our industrial strength meet.

Mr. Churchill: I do not dissent in any way from the priority and importance that the right hon. Gentleman attaches to the defence of our island base, but he has spoken at length about fighting and winning wars. Does he agree that in the nuclear age what is of the first importance is deterring and preventing war?

Mr. Powell: Maybe, but I want to win the war if it comes, and I have no great faith—

Mr. Douglas: Nobody will win it.

Mr. Powell: I have no great faith in mankind being determined on committing suicide. That is a remotely improbable hypothesis. Of course, this is another story and

another debate; but since the hon. Member for Stretford (Mr. Churchill) challenges me, I have to say that I simply do not believe that the realities of future warfare have been radically transformed by nuclear weapons. Rather we shall continue to fight as before, but like the Spartans at Thermopylae in the Persian wars we shall fight in the shade of it.
I turn from the sea-air element to the military element, in the sense of our land forces. Here we have to go much further yet than the right hon. Gentleman has been able to go. If it is true that this country cannot appreciably influence the outcome of the Continental land battle, and if the outcome of the Continental land battle—and this is no secret to the Continental nations one is letting nothing out that they do not understand—is not the ultimate be-all-and-end-all for the United Kingdom, what we have to face is the fact that the British Army will, indeed, play a part, and perhaps a vital part, but in the later stages of a war. It is not the early mobilisation of that Army and its deployment in the field, as it used to be for the nations of the Continent in the nineteenth century, that matters for us. What matters for us is to have an Army in being in time of peace—something we can now do without interference from the alternative commitment of Imperial policing—to have an Army which, first, maintains the military skills and military spirit of this country and, secondly, forms the basis for expansion into whatever force and manpower we need to put in the field as a future conflict proceeds.
The right hon. Member for Sidcup picked out the reference in the White Paper to the Territorial Army. I not only agree with what the right hon. Gentleman said. I would go much further and say that if we are to use the Territorial Army, we have to make it essential—not just a rather nice little optional extra, but a built-in essential—of our military preparations.
For if we are to have, in a sense, a cadre army—an army which is the nucleus of the great army of a future war—the Territorial Army provides us with the means of greatly augmenting the cadre which the Regular Forces could otherwise provide. The balance between our Regular Forces and our Territorial Army is, I believe, now profoundly out of date. We have to look to the citizens' army not as an extra but as the means of laying a foundation in peace time for what, 10, 20 or 30 years in the future in unforeseeable circumstances, may have to be, once more, a great British Army.

Mr. John Wilkinson (Ruislip—Northwood): The right hon. Gentleman is on to an important point, but he has ducked it. I take the point that it is militarily dangerous to have the flower of one's professional Army far forward, virtually on the Elbe. But would the right hon. Gentleman, in his strategic analysis, go so far as to advocate renegotiation of the Brussels Treaty? That is the implication of his remarks.

Mr. Powell: I read the terminology of the White Paper in that context very carefully and it seems to me that it was so drafted as not to admit in so many terms that the precise figure of 55,000 is mandatory in the terms of the Brussels Treaty. At any rate, that is how I interpreted it, but if renegotiation is necessary, then I say "Renegotiate" because I do not believe that while maintaining a 55,000-man Army in front-line conditions on the Elbe—as the hon. Member says—we can do all the other things, more important to our survival and, therefore more


important to the defence of Europe, that we require to do. That is the point where we have to find not economies, and not a reduction of effectiveness, but a different method of obtaining that effectiveness. For that an entirely different Territorial Army, differently conceived, will be essential.
Finally, I referred just now to circumstances 10, 20 or 30 years ahead. It is the preparations that take place so long before a war which determine its outcome. We do not know what the constellation of forces will be in that war. The present balance, the present identification of friend and foe are not eternal: they are subject to change, to the great unforeseeable movements of the nations and Powers of the world. So, in the last resort, we have always to ask "Whose defence is it?" We say "The defence of NATO." Yes, that is our Alliance, that is the present balance. But let us never fail to understand that in the last resort it is the defence of this nation and no other with which we are concerned. So, at the end, in this subject as in so many, this country finds itself asking the ultimate question: are we still a nation, and do we mean still to be a nation? Until we have answered that question, firmly and to our satisfaction, we will not obtain the right answer in any other direction of our politics or endeavours.

Several Hon. Members: rose—

Mr. Speaker: Order. Before I call the hon. Member for Portsmouth, North (Mr. Griffiths), I should make it clear to hon. Members who represent Portsmouth and Chatham that, if we are to have a balanced debate, it will be impossible for me to call every hon. Member who is seeking to catch my eye. Obviously, I shall do my best.

Mr. Peter Griffiths: Recognising the points that you have made, Mr. Speaker, I shall attempt to be brief. I trust that the right hon. Member for Down, South (Mr. Powell), who said that this is a debate on broad strategy, will accept my reasons for keeping to a fairly narrow canvas.
I never expected that I would wonder whether to support a Conservative Government in a defence debate. I could have envisaged that situation arising on other subjects, but not on defence, because I had always assumed that my thinking and that of the leaders of the party of which I have been a member for many years was closely in tune.
The hon. Member for Pontypridd (Mr. John) said that those in dockyard towns felt that they had been let down by the Government. I go further and say that hon. Members in constituencies that include Royal Navy dockyards also feel let down, because no case has been made to us that has given us the opportunity to pass on to our constituents a rational case for the running down of the surface fleet, particularly the escort vessel part of that fleet, and the dockyards that support those vessels.
My right hon. Friend the Secretary of State for Defence described a possible scenario for war. It disturbed me because he spoke of an all-out conflict—a smashing blow at the central front in Europe and war at sea and in the air. But experience since 1945 does not suggest that that is the most likely development.
Since 1945 we have been engaged in limited military, naval and air operations. The biggest Army operations have been in Northern Ireland and Korea. The biggest

Royal Air Force operation was carrying supplies to Berlin, and the biggest naval operations have been those in aid of civil Governments in territories struck by natural disasters or in conflicts with our friends in Iceland. The experience has been of relatively limited conflicts requiring the ready availability of conventional forces.
I shall concentrate on the Royal Navy. I believe that there is broad disquiet in the House and outside about the strategy that the Government are adopting, which will see a large-scale rundown of the number of escort vessels available for service at any given time. That is my key objection.
I do not believe that it is possible for us to carry out our commitment to NATO in the Eastern Atlantic with a fleet that is dominated by the need to provide hunter-killer submarines for operations against Russian nuclear-powered submarines.
It is the presence of a surface vessel which provides the conventional deterrent effect. The sending of a nuclear submarine to an area of conflict is, by definition, unlikely to have an effect in demonstrating a presence, because submarines operate under the sea and out of sight.
The arrival of a naval vessel on the surface signals protection for British fishing vessels, oil rigs or merchant ships, not at a time of all-out war but when, for example, an adventure takes place, not necessarily by a great nuclear Power such as the Soviet Union, but perhaps by one of the smaller militaristic nations seeking to interfere with our seaborne trade. We should not be able to deal with such interference by sending hunter-killer submarines, and we should not dream of using the nuclear deterrent.
There may be room for a difference of opinion between my right hon. Friend the Secretary of State and me, but if we run down the capacity of the Royal dockyards to back up the surface fleet, and in particular to maintain vessels in service and to put them back into service quickly if they have gone into reserve, I am certain that an emergency would see us forced far too quickly to take action beyond the scale that we should have chosen had all the options been open to us. We need to maintain the dockyard capacity as a base for conventional, relatively limited-scale naval operations in a future limited conflict.
The danger is that if we are to proceed with the White Paper proposals, the dockyard at Chatham will be gone. There is no way in which it can be restored, and I assume that no attempt will be made to restore it. If we run down the dockyard in Portsmouth to the extent suggested, which is that we should keep only 1,200 of the work force instead of more than 7,000 at present, that number will not be capable of maintaining a defence capability there, beyond that of simply servicing the naval establishments.
At present, 15 per cent. of the Portsmouth dockyard capacity is used to support the training shore establishments. We are keeping just about that scale of force. Therefore, there will be only a small labour force in the dockyard to man the facilities that we keep. We are getting the worst of both worlds. We are not providing the city of Portsmouth with the area on which the dockyard stands, nor are we maintaining a viable reserve dockyard, because, although we shall have the land, we shall not have the labour force.
The same analysis applies to the projected rundown of the dockyard labour force. I do not believe that it is likely that we can arrange neatly for 5 per cent. of the work force to leave this year, 45 per cent. in the next financial year and 50 per cent. in the following year. The most highly


skilled people will look for alternative jobs. If they can see job security elsewhere, they will go, and I shall say "Good luck" to them. That will leave us with an unbalanced labour force, larger than that which the Secretary of State wishes to have, but not capable of carrying out the work in an emergency, because it will lack the skilled leaders of the teams that are to operate. There will be a ragged movement out of the dockyard, with most people simply waiting for their redundancy pay.
Had my right hon. Friend said anything that could be seen as offering Portsmouth a new role in our defence, a new opportunity to serve as we have served for the past 450 years, I should have grasped it. I have sought to find a way in which I can present to the people of Portsmouth the challenge of the future, but the future has been taken away from them. The heart has been taken out of the constituency, and no amount of description of that as redeployment or contraction can alter that fact. There are no alternative jobs for the people who leave the dockyard, except for those who are highly skilled. The vast majority of semi-skilled and unskilled will join the unemployed.
If we could be told that there were major decisions to move new work opportunities into the existing facilities, that would be a great advantage. Perhaps it would be possible for our NATO allies to use some of the dockyard's resources. I think, in particular, of the American Mediterranean fleet, which does not have a major dockyard base in the Mediterranean. That could keep part of the dockyard in operation.
It would also be of advantage if it were known that there would be future defence contracts. For example, work on the heavy torpedo that is a necessary replacement for the Navy could perhaps be carried out in the dockyard's workshops and fabricating plants. That, too, would make the White Paper's strategy saleable.
However. I have heard nothing of any of that since the White Paper was published. It is therefore with the utmost regret that I must tell my right hon. Friend that my constituents will find the proposals unacceptable. My loyalty to my party, which I have held for more than 30 years, is stretched to breaking point.
I promised my constituents when I was elected that if a conflict arose between party loyalty and my constituency—between supporting the Government and my constituency's direct, immediate interests—I should support my constituents. For that reason, I shall vote against the White Paper.

Mr. Douglas Jay: The hon. Member for Portsmouth, North (Mr. Griffiths) put vigorously what I believe is a very strong case. I wholly endorse and applaud what the right hon. Member for Sidcup (Mr. Heath) said about the need for international arms control and, in particular, control of nuclear arms. I do not believe that we shall get adequate public support in this country for sensible defence policies until visible progress is made on international arms control in the world as a whole.
The Secretary of State began his speech by saying that in defence terms nothing is to be gained by taking risks. But listening to him I could not help but find it strange that, at a time when this country finds itself for the first time for several centuries faced by a hostile navy more powerful than its own, a Conservative Secretary of State should be defending what looks to some people like unilateral

disarmament of the Royal Navy. The Secretary of State should at least answer more questions than he has done so far. I wish to ask him a few today, particularly about our capacity for anti-submarine warfare.
I think that all of us, including the Secretary of State, would agree that if this country is defenceless against conventional attack, a desperate resort to nuclear weapons becomes more likely. The Soviet Union has today about 400 submarines, more than 150 of which are nuclear-powered, and that total is at least double what Hitler possessed in the last war.
How will we defend our oil wells and convoys in time of war against such a formidible attack? We are often told that everything is now different from what it was even between 1939 and 1945 and that we must not make the mistake of preparing to fight the last war. But some things are not different.
The White Paper speaks of these islands as
a key forward base in emergency.
We cannot fight a defensive conventional war from that emergency base without at least oil, food and manpower reinforcements imported from overseas. Unless the Secretary of State is saying that these supplies can be imported by aircraft or submarine, surely surface convoys will be necessary. The right hon. Gentleman said something about manpower reinforcement by air. That may be possible to some extent. Perhaps he can say more about it. So far as I know, it is possible only to a very limited extent without surface convoys.
Such convoys in the last war were defended almost entirely by surface escort vessels—destroyers, frigates and minesweepers—of which we had several hundreds at the time, against a submarine fleet barely half that of the Soviet Union today. Yet the Minister now says that he is going to reduce the destroyer and frigate force declared to NATO. It was to be reduced from 59 to "about" 50, according to the White Paper. The debate today, as I understand it, has elucidated the fact that it is more likely to be from 56 to 42, less an unknown number of ships being refitted. It is, anyhow, of that order.
It is now argued that hunter-killer submarines will be one substitute for escort vessels. I believe that "platforms" is the fashionable word. But when one examines both the defence White Paper of the spring and the latest June White Paper more carefully, one finds that, compared with the 160 Soviet nuclear-powered submarines, we have now 12 nuclear-propelled attack submarines, the SSNs, in service. The White Paper states that
the fleet will build up further to 17".
We are now told that it will not reach that figure until 1990. My hon. Friend the Member for Pontypridd (Mr. John) showed convincingly that it will then fall from the figure of 17 because Trident will take over the building capacity at the Barrow yard. I do not think that this is a formidable substitute for the loss of escort vessels.
Next, the Minister said that the new type 23 frigate is to replace the much more costly type 22 now being cancelled. At first sight, that sounds promising. But, again, if one examines the White Paper, all that the right hon. Gentleman says—he did not go any further today—of the type 23 is:
Once the design is settled we will decide the scale and pace of follow-on orders in the light of resources available".
That means that not merely are there no orders at present but that there is not even a design for this desirable vessel. So we may, or we may not, have one new type 23 frigate


in service, we were told today, by 1988. Frankly, that is not a replacement. It is a sharp cut in our maritime defences, partly, one is bound to believe, carried out to make way for Trident.

Sir Frederick Burden: If the support dockyards at Chatham and Portsmouth are closed in 1983–84, there will be a period of several years before the new type 23s come on stream and there will be no repair or refit facilities to keep the fleet at sea.

Mr. Jay: What the hon. Gentleman says is also true. The whole of this operation is being carried out for economic reasons, which to my mind are largely fallacious. I shall not go into that issue in detail today. But when surplus productive capacity exists, there is little, if any, real cost to the nation in making use of that capacity.
On the matter of escort substitutes the Secretary of State said virtually nothing today about the increase of only three aircraft in the fleet of Nimrods which he described in the White Paper as "highly effective" maritime patrol aircraft. I have no doubt that it is valuable. But are three extra planes really a substitute for nine or 10 fewer surface escort vessels? I am sure that the Minister, if he agrees that the lessons of the last war are not wholly to be ignored, will know that the most dangerous attacks on the Northern Arctic convoys in that war were made by bomber aircraft from bases in the north of Norway. The only effective defence proved to be anti-aircraft fire from surface frigates and destroyers protecting the convoy. Is it the view of Defence Ministers now that future convoys could be defended against air attack by either Nimrod aircraft or hunter-killer submarines? If not, how would they be defended?
Unhappily—this is perhaps a minor point—the story of co-operation by the Royal Air Force in naval warfare between 1939 and 1945 does not convince one that, unless many things have changed, this sort of dual control can be relied on. I still ask how the Minister thinks that our vital supplies and reinforcements will be defended in a non-nuclear war. Some may argue—I hope that the Minister does not—that all this does not matter because we shall simply rely on the United States navy through NATO. Incidentally, if that is the argument, it is no good anyone declaring that we shall not co-operate with the United States in defence plans involving cruise missiles. We cannot say that if we are relying wholly on the United States for our maritime defences. Of course, we must cooperate with the United States. But co-operation is not the same thing as total dependence.
There are other people—we have heard whispers today—who suggest that longer-term plans do not much matter because a future war would be over in a matter of days, or perhaps a week or two. Indeed, I thought that I detected some phrase in the Secretary of State's speech to the effect that it might be a short blitzkrieg, or something of that kind. If that is the fashionable view at the moment, I find little comfort in it.
The one result that certainly could not occur in a matter of days in such a war would be a conventional victory for the West. One can imagine other results. Those of us who are non-experts in defence would do well to be a little sceptical about fashionable views of that sort. In September 1939, as many hon. Members will remember, the fashionable expert view was that we should fight a

prolonged war behind fortified lines. Indeed, in August 1914 almost everyone believed that the whole thing would be over in a month. I believe that Lord Kitchener was the exception, but I may be wrong.
Indeed, if the Soviet Union expects a non-nuclear war to be over in a matter of days, why has it built 400 submarines and a number of powerful surface warships at enormous cost to its economy? Is it not probable that, if this country were known to be unable to fight a protracted defensive war at sea, the incentive for the Soviet Union at some moment of crisis, if it ever came, to declare a blockade would be at the maximum? If this country were then unable to resist, the risk of nuclear war would surely be all the greater.
I come back, therefore, to the maxim that if one wants to minimise the risk of nuclear escalation, one must have conventional defence capacity. I ask the Minister of State to explain more clearly and rather more convincingly than the Secretary of State yet has how he applies that principle to future anti-submarine warfare.

Mr. Julian Amery: Not for the first time, I find myself in an almost embarrassing degree of agreement with the right hon. Member for Battersea, North (Mr. Jay). I am grateful to him for asking many of the questions that I had intended to ask. That will enable me to shorten my remarks.
Many forward-looking thoughts have been expressed in the debate. I hope that I shall not strike an unwelcome note if I ask the House to look back. My right hon. Friend the Prime Minister was foremost among those who denounced the threat of Soviet imperialism. That was before the invasion of Afghanistan and the intimidation of Poland. She accompanied her remarks with a call to strengthen our defences. Most of us thought that that meant strengthening our capability, not simply our financial contribution. I do not think that it was only innocent Back Benchers such as myself who thought that. My right hon. Friend the Chancellor of the Duchy of Lancaster, when he was Secretary of State for Defence, had exactly the same idea.
My right hon. Friend found that a 3 per cent. increase in real terms would not allow him to maintain what we might call the Mulley programme, let alone to strengthen our defences. With refreshing candour, he came to the House and said that cash limits could not apply to the defence programme. The Treasury team stepped in and my right hon. Friend was elevated to his present position, where the only harm that he can do to the Exchequer is involved in his influence over the Kitchen Committee or the pay of Members.
My right hon. Friend the present Secretary of State for Defence openly admitted—and the White Paper endorses it—that he would operate within cash limits. That was a condition of his employment. He was given the job on those terms. I suppose that somebody had to do the job. I admit that the good humour and skill with which he has presented the review has enhanced his reputation in the eyes of both the public and the House. He did it as well as anyone could, and with a certain gusto. When my right hon. Friend the Secretary of State for Industry embarks on massive neo-Keynesian policies, he does it with great reluctance, as though his teeth were being pulled. My right hon. Friend the Secretary of State for Defence does it with all the enthusiasm of Premier Trudeau turning a cartwheel.
Given the cash limits set by his employers I shall not quarrel with the priorities, nor with the way in which my right hon. Friend has allocated the resources made available to him by the Treasury team. I am not surprised that, apart from the Trident programme, which was decided by his predecessor, there is nothing serious in the area of modernisation to be found in the White Paper. I have never known a White Paper to be produced so quickly by someone with so little knowledge of defence as my right hon. Friend, together with the Prime Minister with whom he works.
There are serious cuts in our overall capability. The right hon. Member for Battersea, North mentioned them. I shall touch upon three. There is to be no replacement for the Jaguar for the Royal Air Force. It will have to make do with the Harrier. I was involved in the development of both the Jaguar and the Harrier. There is no conceivable way in which the Harrier can take the place of the Jaguar. The reduction in the overall capability of the Navy has come out clearly in the debate and in the replies that my right hon. Friend has made to various questions.
I wish to deal with a point that has not been fully developed. We are proposing to cut the manpower of the Services by 18,000 to 20,000 men. I am not saying that all those men, who will now be shed, should be retained. Some of them may be in trades that we do not need. But 20,000 men are a lot of men. It is nearly half of our commitment to the BAOR under the Brussels Treaty. Many senior officers have told me that although their units are up to establishment, the establishment is fearfully tight.
My right hon. Friend the Prime Minister made a great show in Washington about how she wanted to support President Reagan in the rapid deployment force. With 20,000 men re-employed in the Services in the right way, we could huff-up the establishments of existing units. We might even produce a credible contribution to the rapid deployment force, instead of the purely cosmetic contribution to which the right hon. Member for Down, South (Mr. Powell) referred.
There have been many defence reviews during the time that I have been in the House. The Labour Government cut defence to the bone. My right hon. Friend is cutting it to the marrow. There is something rather inconsequential, rather Irish, about the timing. There is general agreement that the threat is the greatest that we have faced since the war. There is general agreement that the matter is urgent, that the window of opportunity is opening for the Russians and that for the next five, six or 10 years we shall be at our weakest. After that, I hope that the industrial power of the West will allow us to take a more relaxed view. This is the moment of danger. There is a general consensus that the threat may well develop outside NATO, as well as in Europe. All the external signs appear to dictate a strengthening of our capability, or at least maintaining it—certainly not cutting it.
Yet we are told that we cannot afford to maintain our capability, let alone strengthen it. The Russians appear to be able to do that, and their standard of living is about half of ours, if not lower. Of course, Russia has a dictatorship. It is easier to tell people what to do if there is a dictatorship. The United States, which is the greatest democracy in the world, and which has a Parliament much better equipped than ours to block the action of the Executive, is determined to increase its defence expenditure by a phenomenal proportion during the next

two years. It is true that our European allies and Japanese friends spend a slightly smaller proportion of their gross domestic product on defence than does Britain. But the totals are much larger—1 per cent. of the Japanese GDP is about as much as we propose to spend.
Of course, we face severe, deep-seated problems that will not be easily solved. The right hon. Member for Battersea, North has some experience of that. But I think that he will agree that while the problems may in some ways be worse than at any time since the war, we are not in a crisis. There is no balance of payments crisis. Sterling is strong. We have all the problems of the recession and the problems that result from trying to deal with it. However, we are discussing a 10-year programme. Are my right hon. Friends really saying that looking 10 years ahead we have no option, even when the threat is higher than ever before, other than to cut defence expenditure? If they are saying that, they are putting in question not the management of the Ministry of Defence but the management of the economy. Have they really so little confidence in the economic policies to which they are pledged?
The White Paper is the best supporting argument that I have seen for the Opposition Party and for my right hon. Friend the Member for Sidcup (Mr. Heath). Do we really not think that we can generate the resources under Conservative economic policies to enable us to spend £500 million more on defence each year during the next 10 years?
In the nuclear age, the name of the game is deterrence. Everything depends upon the ability to deter a nuclear attack, and, if there is a local attack, to prevent its becoming a nuclear attack. If there is a conflagration—and here I disagree with the right hon. Member for Down, South—there will not be much time to mobilise resources. The peace-time capability determines the ability to maintain survival—rather than to win a war. What we have now may prevent the conflagration. It is no good having it in the backyard. While the threat grows, the Government are cutting our capability—in the hope, I suppose, of reducing inflation and notching it down by another point or two. Frankly, I would rather survive.
I am concerned about the Prime Minister's position. My right hon. Friend the Secretary of State has a particular job to do. He was put in by the Treasury team to do it. My right hon. Friend the Prime Minister gained worldwide respect as a result of her "Iron Lady" speech. She was seen as a real defender of the realm. A heavy responsibility rests upon my right hon. Friend. She moved my right hon. Friend the Chancellor of the Duchy of Lancaster from the Ministry of Defence and put in my right hon. Friend the Member for St. Ives (Mr. Nott) to do the job.
The Chiefs of Staff have met my right hon. Friend the Prime Minister on two occasions in the past six months. They have claimed their constitutional right of access to the Prime Minister. During 30 years in the House of Commons, several of them spent in defence departments, I cannot remember the Chiefs of Staff exercising that right so often. I understand that they left the Prime Minister having been overruled. We are told that Sir Winston Churchill never overruled the Chiefs of Staff. He argued with them for long hours through the night, but he never overruled them, because, unlike some of those who are now managing our defences, he had a lifetime of experience of defence.

Dr. David Owen: I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
'while noting that "The United Kingdom Defence Programme: The Way Forward" (Cmnd. 8288) restrains the current defence budget to a 3 per cent. real terms increase per year until 1985–86, nevertheless believes that the inclusion of the Trident nuclear missile submarine programme will ensure that the overall cost of the defence budget places an undue burden on the nation's resources and that this programme should be cancelled and a portion of the saving thus achieved should be spent on increasing the build-rate of hunter-killer submarines.'.
The amendment gives those who criticise on financial grounds the Government's decision to go ahead with the Trident programme the opportunity to vote on that issue but to support the overall decision to curb the defence budget and to bring it down within the broad range of what the United Kingdom can afford. The central issue is whether the Government are correct to have made a series of defence decisions, some of which are extremely painful, to curb the rise in defence expenditure, but to accept a rise of 3 per cent. in real terms.
The Secretary of State began the debate with an extremely sombre account of the state of the world, the strategic implications and the growth of Soviet forces. The debate is taking place at a time when the finances and economy of the United Kingdom present an extremely sombre background. We have appalling unemployment, which is likely to worsen. The House has to seek a balance. The balance will be arrived at after coming to a decision on the correct amount to be spent on defence and by deciding how the moneys should be spent.
The amendment provides an opportunity for those who are not prepared to continue to vote against the Government purely and simply because of their commitment to Trident. We oppose Trident, but we do not want the decision to be the excuse for us to join arms with a range of people who we know do not want to spend anything on defence or who wish to reduce defence expenditure to a level that would put the nation at peril and produce a massive loss of jobs in the defence industry.
In forming their judgment tonight, my right hon. and hon. Friends and Labour Members should not vote against the Estimates. It would require a serious decision to vote against them. The revised Estimates take us forward to 1985–86.

Mr. John: What is the right hon. Gentleman's position?

Dr. Owen: I listened to the speech of the hon. Member for Pontypridd (Mr. John) with some degree of concern for him. We know that he has a difficult task in speaking from the Opposition Front Bench for the party of which he is a member. He did not produce one proposition. If he wishes to attack the 3 per cent. real-terms defence expenditure as being too much, let him say so. If he thinks that there should be further cuts, let him say where they should be made. If he wants more escort vessels, let him say where the money is coming from. If he wants more ships to be built, let him say where the money is coming from. If he wants more jobs in the defence industry, let him say where the money is coming from. Some of us are getting fed up with the humbug that we hear from the Opposition Benches. The Opposition's criticism of the Government is not credible.

Mr. Jay: I must remind the right hon. Gentleman that we are voting tonight on the proposition that the House approves the White Paper. We are not voting on the defence Estimates. I should not be prepared to vote against the Estimates, but I am prepared to vote against the argument in the White Paper.

Dr. Owen: The White Paper contains forward defence estimates to 1985–86. The previous defence debate in the House was superseded by the fact that there was to be a major review. This is the White Paper on which we are considering forward defence for the next three to four years and on which the jobs and lives of many of our constituents will depend.
I realise the problems of many of those who are facing unemployment at Chatham and Portsmouth dockyards. These two yards have served Britain extremely well. My constituency is somewhat shielded from the consequences of the Government's decision and it is easier for me to support some of their decisions. I am conscious of the consequences that they will have, especially for Chatham.
The House is being asked to decide whether the Secretary of State's broad decisions are correct. With the sole exception of the Trident decision, I think that the right hon. Gentleman has made broadly a correct choice. My main criticism is that he has not followed through much of the logic of his earlier speeches and his earlier comments on defence. Effectively, he is reducing the build rate of hunter-killer submarines.
I am arguing the case for the hunter-killer submarine as an issue that is separate from the question of a nuclear deterrent. In my view, the hunter-killer submarine is the battleship of the future. It is the most flexible and effective ship, especially if it can have more effective weapon systems. I believe that it will have the same form of submarine-to-ship missile in the next 10 years as the Soviet Union has deployed effectively from its submarines.
This is the area of specialisation within NATO that the Royal Navy and the United Kingdom are well placed to commit themselves to undertaking. We are the only European power with nuclear-powered submarines committed to the Alliance. Our hunter-killer submarine fleet, as a result of the decisions taken on the Trident programme, will not expand beyond the 17 that were planned.
The Secretary of State may find that he is running into difficulty with some of the earlier hunter-killer submarines that are coming to the end of their useful lives. We should like to know much more about the exact schedule of future build for the hunter-killer submarines. The House is entitled to ask for that information. If we wish to improve our conventional defences, it will be necessary to increase the build rate of the hunter-killer submarine. That will not be possible without opening up the Cammell Laird shipyard while pursuing the Trident programme.

Mr. Churchill: Will the right hon. Gentleman tell the House which, in his judgment, would give the masters of the Kremlin more cause for thought before embarking on aggression against NATO Europe—four Trident submarines or a dozen hunter-killer submarines?

Dr. Owen: That is a rather silly way of putting a more complex question. The issue for the Trident programme is clear in my mind, if not in the minds of others. I am not in favour of Britain giving up its nuclear weapon position. I am in favour of continuing with the Polaris submarine,


which is an effective deterrent for a country in Britain's position. We do not need a maximum deterrent of the sophistication of the Trident system. I am supported in that view by a great many outside the House. The sooner that that is understood, the better. It is a view that was supported by the International Institute for Strategic Studies in a recent memorandum to the Select Committee on Defence. Its excellent fourth report sets out clearly many of the issues.
That report comes down firmly against a Trident system. Furthermore, it says that there is scope for extending the life of the Polaris system beyond 1995. In its revised submission it says that it thinks that there is more of a case than it had hitherto thought for the cruise missile option, although it would like to consider it further. It favours putting them on hovercraft, although I do not favour that option. I believe that we should look seriously at the possibility of putting them on hunter-killer submarines if, in 1995 or thereabouts, it is felt necessary for Britain to continue its nuclear deterrent.
The right hon. Member for Sidcup (Mr. Heath) rightly raised the question of arms control, which includes the whole issue of establishing—in many cases reestablishing—our credibility with the general public both in Britain and in Europe in our wish to pursue arms control. I do not believe that we establish our credibility by deciding on the Trident missile, which will substantially increase our nuclear weapons in both qualitative and quantitative terms.
It would be better for Britain to commit itself wholeheartedly to arms control. Trident is just about compatible with the non-proliferation treaty, but one reason why the Government have hardened their position over the comprehensive test ban is related to the Trident decision.
I further believe that there is more scope in the comprehensive test ban negotiations than the Prime Minister has previously acknowledged. During a question and answer session a few weeks ago, she implied that the Soviet Union was maintaining its earlier position of demanding from the United Kingdom a large number of seismic stations in order to ensure that the comprehensive test ban was maintained. However, when I talked to Mr. Gromyko in Moscow a few weeks ago, I found that the position of the Soviet Union had changed significantly and that it was no longer demanding, in my view unreasonably, such a large number of seismic stations. It had reduced the number to a more appropriate level, which I think the British Government should accept.
It is necessary to look at the Trident decision in relation to arms control and what can or cannot be achieved on a comprehensive test ban and what can or cannot be done to breathe new life into the non-proliferation treaty, which is in serious jeopardy. The recent events in Iraq are but one example of the ever-increasing proliferation of nuclear weapon States.
I remind the House that in the non-proliferation treaty there is a commitment by the non-nuclear weapon States to curb their own vertical proliferation in exchange for a commitment from the non-nuclear weapon States to curb their horizontal proliferation. A bad example has been set by all the nuclear weapon States. If the House wants to set an example, we have it within our power to forgo a decision to embark upon an extremely expensive Trident missile programme at the present time.
The other major criticism is that we are being asked to underwrite a commitment to the Trident missile system with absolutely no knowledge of the costings. We are still being told that the cost will be £5 billion, but all the evidence indicates that that cost has already escalated beyond £6 billion, and some would say £7 billion.
The Secretary of State shakes his head. He could at least tell us exactly which missile and how large a submarine he intends to purchase. If he does not know, he should not be so strong in his criticism of a forecast of more than £5 billion when in his heart he knows that he will have to reveal a cost far in excess of that.
I believe that the Trident programme should not go ahead, but I must face the fact that even if it were to be cancelled its effect on the defence budget would not be immense. It represents 1½ per cent. over the next five years. I am arguing that in some areas of defence there should be an increase in expenditure. There should be a modest increase in the hunter-killer submarine build rate. The Secretary of State has promised more information on that, and many of us would like to know the details. In certain circumstances, there may be a case to suggest that the number of frigates available to the Government at any time will be insufficient. All that I know is that when I was Foreign Secretary and wanted a frigate, it was immensely difficult to get one to go to the Caribbean or anywhere else.
If frigates are not to be readily available I do not think that the Foreign Secretary will be at all happy with the number of escort vessels. I support the Secretary of State on the basic decision that the hunter-killer submarine is a more effective weapons system. If I had to choose, I should put the money into hunter-killer submarines and any remaining money that I felt I could afford into escort vessels. I should wish Britain to maintain a 3 per cent. defence budget as long as it could, but, given the present financial situation, I do not believe that any prudent Chancellor, Prime Minister or Foreign Secretary could give a commitment that five years hence the defence budget will be increased by 3 per cent. in real terms. That is an unrealistic commitment. If the forward defence Estimates are to be planned on that basis, I believe that we shall see some expensive cancellations of a kind with which we are all too familiar.

Mr. Moate: The right hon. Gentleman referred to the importance of the hunter-killer fleet. Does he concede that its effectiveness depends upon the refit capacity? Does he believe that the capacity at Devonport is adequate to cope with the three-stream refit capacity that will be needed, even in the next few years, because Chatham will close in 1983? Whatever the future might hold for Devonport, should we have such confidence when the one vessel in for refit is now in its third year?

Dr. Owen: I have the utmost confidence in the ability of Devonport dockyard to carry out the refits. The hon. Gentleman will not be surprised to learn that I do not intend to give him a different answer. I accept that the Secretary of State is running the present refit capacity extremely tight, but that is probably possible on what I still believe to be a reduced hunter-killer build rate.
The right hon. Gentleman said that there was a possibility of accelerating Devonport from a 16 to 12 to 10-month build rate. It has long been the wish of


successive Governments to accelerate the build rate of hunter-killer submarines, because they have felt that the size of the fleet was insufficient. The right hon. Gentleman is probably just about all right, but he is running it extremely tight.
If the right hon. Gentleman is to achieve expenditure savings, he must do so from somewhere. Unless he envisages some strategic cuts and closures, he will not achieve them. I believe that he has courageously faced that decision. The House must also face it. The problem is that we constantly want to avoid making strategic decisions, so we spread the misery across the Army, Navy and Air Force. We refuse to make some of the basic decisions that are necessary to reshape our defence effort. In that sense, the Secretary of State's attempt is praiseworthy.
I am reluctant to vote against the Secretary of State's proposal, and I do not intend to vote against it tonight. I am giving the House the opportunity to vote against the basic decision that underlies the defence budget—the decision on the Trident missile system.
As to the balance of forces, I do not agree with the right hon. Member for Down, South (Mr. Powell) that we can almost ignore the level of forces in Europe and on the central front. He reminded the Secretary of State of the speeches that he used to make when he was defence spokesman for the Conservative Party. I remember listening to them, because at the time I was the Parliamentary Private Secretary to Gerry Reynolds. At that time, he always emphasised the need for a conventional defence capacity in Europe and an effective army, as I understood it. His anxiety about the way in which we were being pushed to lower the nuclear threshold always won my support.
If I am doing the right hon. Gentleman an injustice in remembering his speeches, I shall check them. I have always understood him to be strong in his belief, which I believe to be the right one, that we must have a strong conventional defence capacity. That includes the Army and the central front. if we are not to lower the nuclear threshold.
I believe that much of our nuclear theology in NATO is wrong. Most of the tactical nuclear strategy is incredible. I agree with others who have criticised the fact that it does not believe that politicians will be prepared to embark on battlefield nuclear weapon exchange. The sooner we recognise that, the better.
I accept the need for an overall nuclear deterrent. I am grateful that the United States has the Trident missile system. If this country has the financial resources to support one, I should also be in favour of it. However, this country must start to face the economic realities of life. Its best contribution to NATO is in having a strong conventional capability and in retaining a nuclear option, but not adopting the Trident system.

Mr. Nott: The right hon. Gentleman says that he wants to build more SSNs. I do not dissent from that. He realises that about three-quarters of the cost of Trident is the nuclear submarine. Therefore, I must tell him that by building SSNs, either with Sub-Harpoon, which is not a British system, or with cruise missiles, which is also not a British system, even on his policy the right hon.
Gentleman would not save much money. He says that he wants a nuclear deterrent, but he will not save much money by going for SSNs with Sub-Harpoon.

Dr. Owen: I should have thought that I was being realistic in saying that there would not be a total saving. The Secretary of State cannot equate the cost of building an SSN with that of the new Trident submarine, which is larger and which will be more expensive. If he considers the experience of the United States Navy in building its first Trident submarine, he will see that the cost escalation has been fantastic.
There is also quite a lot of associated expenditure with the Trident system, apart from the purchase of the missiles. I do not accept the Secretary of State's £5 billion estimate. The purpose of the amendment is to say that there is a need for further expenditure in some areas. I accept some of the criticism that the Secretary of State has gone too far with the Royal Navy. Some of his cuts have been damaging. I believe that his cuts in the escort fleet have not been matched by what I believe was his intention and by what he said to the House was his wish, which was to increase the SSN build rate.

Mr. Patrick Cormack: The right hon. Gentleman has been putting forward a confused case. A few moments ago he said that Trident would be 1½ per cent. of the defence budget and in the next sentence he proceeded to spend that 1½ per cent. on something else. He was justified in doing that, but then he said that the country could not afford it. It is difficult to follow the logic of his argument.

Dr. Owen: The hon. Gentleman should try to study the argument. The 1½ per cent. is on an estimate of £5 billion, which I do not accept. It is also only for the first five years. For the next five years it goes up to 5 per cent. of the defence budget, 10 per cent. of the equipment budget and 15 per cent. of the new equipment budget. In the latter five years it comes down to between 1 and 2 per cent. Therefore, over the next five years we are seeing the most favourable period of expenditure on the Trident missile system.
Increasing the hunter-killer submarine build rate would not take up 1½ per cent. of the defence budget. One can decide whether one wishes it to take up 1 per cent. or 0·5 per cent. It is up to the person concerned to decide how quickly the submarines are ordered. I believe that there has been a hold-back in the submarine build rate, which is damaging.
Other expenditure priorities will come up. Furthermore, there will be cost escalations which have not been met in the current defence budget. However, the defence budget marks a step towards greater realism. The Secretary of State inherited a defence budget which had got wildly out of control, as everyone in the House knows. In that sense, I believe that the right hon. Gentleman is right to cut back the budget, which is becoming more than the country can afford. I still believe that it is too lavish, but it is in the ball park which we can support at present. What I do not believe we can accept is a forward commitment to such substantial expenditure as represented by the Trident missile system. For those reasons it should be rejected.
What needs to be asked, and what I hope will eventually come out when Labour Members speak, is: what is the Government's defence programme? Do they


intend to cut the defence programme by £3½ billion or £4 billion, or do they intend to maintain 3 per cent. of the defence budget? Their argument is about how they distribute in other areas of defence the savings that would come from the Trident missile system. If the House could hear an answer to those questions tonight, it would be easier to judge some of the merits of the defence programme.
I am not prepared to recommend to my right hon. and hon. Friends that we should vote against the White Paper, because in doing so I believe that we would give sustenance to those who believe that their vote represents a vote to reduce our defence expenditure to a dangerous level.

Mrs. Peggy Fenner: Perhaps it is a sad irony that I should follow the right hon. Member for Plymouth, Devonport (Dr. Owen), considering that the proposals in the White Paper for the dockyard area which I and some of my colleagues represent are also proposals for his dockyard.
I am grateful to have caught your eye, Mr. Deputy Speaker, especially since I know that a number of my party's experts wish to speak on defence and that nine-tenths of the acreage of the dockyard which bears the name of Chatham is in the constituency of my colleague, the hon. Member for Gillingham (Sir F. A. Burden), who has served its interests with devotion and distinction for 31 years. Large numbers of constituents from both our constituencies—jointly known as the Medway towns—have, for several generations, worked in the yard.
I understand both the task and the responsibility placed on my right hon. Friend the Secretary of State. Given the level of 5·2 per cent. of GDP currently spent on defence—adequate defence to which my party is pledged—plus the 3 per cent. additional annual commitment to NATO, my right hon. Friend has a duty to ensure value for money and, what is more important, defence capability.
I appreciate the cost growth problem which my right hon. Friend outlines in paragraph 4 of the programme and his concern with the balance within that programme. I cannot argue against the logic of accepting the vulnerability of aircraft carriers or of the surface fleet. The review states that, for the future, the most cost-effective mix will be one which continues to enhance our maritime, air and submarine effort. I know that my right hon. Friend has had a tough task, not least in resolving
the most complex and difficult issues in the future shape of Britain's maritime contribution".
Paragraph 26 asserts that our most powerful vessels for maritime war are our nuclear-propelled attack submarines. At present there are 12 and by the late 1980s there will be 17. With the new diesel-powered SSKs, those will be equipped with a new heavyweight torpedo. I hope that in that respect my right hon. Friend intends to buy British and to support the British heavyweight torpedo.
My right hon. Friend will judge that until this point he has a deal of sympathy and support from me for his job of reviewing our current defence position. It is on paragraph 40, with its conclusions for closing the Royal dockyard at Chatham in 1984, that we part company and I take issue with him.
Among the first questions which I asked my right hon. Friend after his statement to the House on 25 June, in view of the 45 per cent. nuclear workload at Chatham, was:
How does it happen that in a realignment of the surface fleet, this refitting is removed from Chatham, when they have worked up such an expertise?"—[Official Report, 25 June 1981; Vol. 7, c. 393.]
My right hon. Friend did not answer my questions. I appreciate that I asked the questions during a brief period after his statement. I ask the questions today in more detail and I expect some answers by the end of the debate.
With a submarine fleet of 17 plus four Polaris submarines, how will he refit them if the one proven refitting yard is closed? Where will the "Valiant" and "Churchill" go to refit? The Secretary of State said that the question of single or twin stream was irrelevant. He knows that Rosyth has a single stream for one Polaris submarine at a time—a figure which he clearly intends to increase, according to his comments today.
Devonport has not yet successfully refitted one submarine. The "Swiftsure" which entered in December 1978, is unlikely to emerge before mid-1983, for reasons not yet made public. What has gone wrong with that refit and what will it cost to put it right? Is that the dockyard to which my right hon. Friend intends to transfer the expertise and work from Chatham?
Devonport is being prepared for two-stream refitting, but I understood that it was already fully committed through the 1980s with six Swiftsure and five projected Trafalgar class submarines. Where will the submarines "Conqueror", "Courageous" and "Dreadnought" be refitted in the next four years? Refits to submarines must not be delayed if the submarines are to remain operational. No evidence has yet been produced to show that the submarine fleet can be maintained without the facilities at Chatham dockyard. It is the only dockyard with proven capacity for two-stream refits, and on one occasion it handled three.
Chatham dockyard has experience which it has taken five years to develop. It has the best record for time and cost. It has completed seven nuclear submarine refits in an average of two years. Two more are in the yard. I know that the "Courageous" refit was the first and only one to be strictly on time, but the Secretary of State will admit that the time slippage has not been severe since 1973. Chatham is the only yard which has refitted Valiant class submarines.
Apart from its expertise in nuclear submarines, other facilities are available at Chatham which are not duplicated elsewhere. We should like answers about them. The weapon radio centre is the only establisment in the country with detailed experience in major repair of cryptographic equipment. Another specialisation is the servicing of rocket launchers.
I am sorry to ask the Secretary of State so many questions, but in a rather shattering machine gun-style delivery, well beyond dictation speed, he tried to tell me how he was planning to ensure that the submarines could be refitted. I should like him to do that again at a speed which I can understand more easily.
Is the programme for the "Sovereign" in 1981 and the "Conqueror" in 1982 still going ahead? Does he accept that in the mid-1980s an increasing number of nuclear submarines will be laid up awaiting refits? Where will the refits of conventional submarines and proposed new design submarines be undertaken?
Is the Secretary of State aware that Chatham has an unparalleled reputation for building submarines? The last two that were built there were sold to Canada. Does he think that they would have been if they had not been excellent?
My right hon. Friend will observe that so far I have directed my objections and questions to the issue of defence capability and my concern about parts of his review. I have not sought to express the undoubted case which can be made in terms of centuries of tradition and the great reputation of the naval base and dockyard. He must know that the name of Chatham is synonymous with that of the Royal Navy.
I cannot be derided from the Front Bench for sentiment or for a judgment warped by having a naval base in my constituency. Why on earth I should find it necessary to apologise for either supporting tradition or wanting to preserve that which is good escapes me. The role of the Navy dockyard, which is the heart of the Medway towns, is defended and supported by thousands of my constituents.

Mr. Arthur Lewis: The hon. Member for Rochester and Chatham (Mrs. Fenner) has put a number of leading questions to the Secretary of State. The hon. Lady has been a doughty fighter for her constituency and party. She was an excellent Minister. I speak in a positive and helpful sense. Does the hon. Lady mean to say that at no time in the preparation for the White Paper did anybody from the Ministry have the decency to meet her and her colleagues to discuss these problems before the decision was made? Neither she nor I would expect the Minister to say what he had in mind, but surely he met her to hear her views before coming to a decision. Is she saying that no one troubled to ask to see her?

Mrs. Fenner: The hon. Member for Newham, North-West (Mr. Lewis) cannot think that I would expect the Secretary of State to consult me before he produced his review. However, I rested in the happy knowledge—now I see that it was fragile—that on 6 August last year I had received assurances that there was work for the four dockyards. What has changed since then is not the weight of the Soviet fleet but the Secretary of State. I have said that I respect the task placed upon him.

Sir Frederick Burden: Does my hon. Friend agree that the mainspring of the bitterness and anger in the Medway towns at the decision is that last August she was given an undertaking by the then Under-Secretary of State for Defence for the Royal Navy that the Government would assure the future of the four naval dockyards?

Mrs. Fenner: I am afraid that my answer must be "Yes".
Today constituents have presented a petition containing 21,000 names. In an impressive march last Friday they demonstrated their solidarity and apprehension, although the march—as always these days—was attended by some Militant Tendency leaflets. The assurance from the Labour Party representative lacked credibility since he belongs to a party not many members of which seem interested in defending us against much. Many members of that party are unilateral nuclear disarmers. How can they claim to wish to sustain nuclear expertise at Chatham? I

commented last Friday that there was only one good defence man left in that party, but he left the party the same day.
I have concentrated on Chatham's nuclear expertise and my concern that the Secretary of State could be taking risks with the refit programme. I believe that my colleagues should find those risks unacceptable. I listened with interest to the right hon. Member for Devonport expressing a little of his concern that the risks, if not unacceptable, are close to being so.
Hon. Members have questioned the assumptions and decisions on the surface fleet. As my colleagues have said, surely a new fleet of light, fast ships will need the same wide ability to repair, service and maintain the high technology machinery as Chatham's long experience in refitting frigates and light naval craft is trained to achieve.
In conclusion, I would only say to my right hon. Friend that whatever expert or experts have written the scenario of a possible future war and have advised him about the changes in the balance of forces contained in the review, of one thing he may be certain—they will surely be wrong. They always have been before. It would be wiser to be sure that our pattern of defence is more diverse than any expert's single wrong scenario.

Mr. R. C. Mitchell: I start from the belief that it is not only the right but the duty of a country to defend itself and to request from its citizens through taxes of one form or another adequate resources for that defence. Never again must this country be in the position in which it found itself in 1939. One of my earliest memories as a young lad is of seeing what I believe were then called the local defence volunteers in the early days of 1940 drilling with broomsticks because there were no rifles, because in the period immediately before the war this country had not rearmed. We all know that if Hitler's bombers had come here in the spring rather than the autumn of 1940 we should almost certainly have lost the Battle of Britain, because we had no aircraft. We also suspect that if Hitler had invaded this country in the summer of 1940 this debate might well not be taking place today.
This country must maintain adequate defences. That means that we must remain a member of NATO and accept all the implications of membership. I have never accepted the need for the so-called independent nuclear deterrent. I agree very much with the arguments of Field Marshal Lord Carver on this issue. I cannot imagine a situation in which we, independently of our allies, particularly the United States, would use nuclear weapons.
I agreed with the right hon. Member for Plymouth, Devonport (Dr. Owen) when he said that the total amount spent on defence must be related to our economic capability. I recognise that it is not possible in the present situation to have even greater expenditure on defence than is now proposed. We must therefore make a choice. I believe that the wrong choice has been made in the White Paper. I believe that, in the present economic situation, putting all our our eggs in the Trident basket inevitably means that we shall have to weaken our defences in other areas. One of those areas has been stressed a great deal today. Coming from the South, as I do, I shall reiterate it.
I refer to the rundown of the Royal Navy, and particularly the proposed rundown in the number of escort vessels. The Secretary of State seemed unsure about this


matter. He had all kinds of figures. The lowest was about 42. I suspect that, if we worked it out, we should find that if, as he told me in answer to an intervention, the new cheaper type 23 frigate will not come on line until 1988, there will be a period in which the figure available for use at any time may well fall below 42.
The hon. Member for Portsmouth, North (Mr. Griffiths) was absolutely right when he said that many of the incidents in which we have been involved over the past 25 years have involved the use of naval surface ships. There was the Icelandic cod war. The right hon. Member for Sidcup (Mr. Heath) spoke of defence in the Gulf. There is even the question of sending frigates for relief purposes to Belize, to the Windward Islands or to some disaster area. For a whole variety of reasons, I believe that it would be extremely unwise severely to run down our naval escort fleet.
What is interesting about this debate is that the White Paper before us, more than most others, shows that it is not possible to make a painless defence cut. That is something which the Labour Party should consider very seriously. It is easy for someone in Walworth Road—or Transport House as it was—to produce a pamphlet saying that Labour Party policy should be a policy of massive defence cuts and for that to go through and to be endorsed wholeheartedly by the Marxist-dominated national executive committee of the party. But it means people's jobs.
It is interesting to note that Labour Members who usually sit on the Front Bench below the Gangway beside the right hon. Member for Devonport and his colleagues have not been with us today. I wonder why. I suspect that I know why. Some of them went to the Grand Committee Room earlier today where they found representatives of thousands of people who work in the Royal Navy shipyards and who were very angry about what was happening. I think that they have decided that discretion is the better part of valour and have not come along tonight. The hon. Member for Salford, East (Mr. Allaun) usually makes marvellous speeches about cutting Britain's defences, but I have yet to hear him make a speech criticising the defence expenditure of the Soviet Union. I hope that I shall hear him make that speech before too long.
One fact to emerge from this debate is that defence means people's jobs. A staggering figure, which I had not appreciated until the present episode, is that 10 per cent. of employed people in the county of Hampshire are employed in defence or defence-related industries. One in 10 is a very high proportion. The direct result of the White Paper will almost certainly be the loss of at least 15,000—probably up to 20,000—jobs in Hampshire.
I hope that the House will forgive me if I stray into semi-constituency matters. We were told in a letter from the Minister of State, of which the Front Bench seems unaware, that 6,000 Ministry of Defence jobs will be lost directly in Portsmouth dockyard. That is just the 6,000 directly employed in the dockyard. Many thousands more are employed in medium-sized and smaller firms in the area which depend almost entirely for their livelihood on the work of the dockyard, so a large number can be added to that total.
I agree very much with the hon. Member for Rochester and Chatham (Mrs. Fenner). I hope that the Secretary of State for Defence will decide to buy the British heavy torpedo—the Marconi. I gather from a meeting the other

day, however, that he was not so sure about that. He talked about cost, and I had a suspicion at the back of my mind that somebody in the Ministry of Defence was thinking that it might be cheaper to buy from America. The enclosed dockyard space at Chatham or Portsmouth could be used to build those torpedoes.
Another important fact that does not emerge from the White Paper is exactly how many jobs, both naval and civilian, will be lost in the training establishments. We have been told that more training is to take place at sea. The present ratio is 60 per cent. of training on shore and 40 per cent. at sea, but the new ratio will be 50:50. How many civilian and military jobs will be lost in training establishments? There are many training establishments in the South, particularly in Hampshire.
Another factor may affect Hampshire. We have not been told the future of the Royal aircraft establishment at Farnborough. That is one of the main providers of work in northern Hampshire. We are waiting for the Strathcona report. I do not know when it will be published.

Dr. John Gilbert: He has lost his job.

Mr. Mitchell: I had not realised that he had joined the unemployed. What will happen to the Royal aircraft establishment at Farnborough? The strategy can be changed only by a major revolt on behalf of Conservative Members.
Incidentally, I find the logic of the decision made by the right hon. Member for Devonport not to vote against the Government most odd. Let us assume that only a few Conservative Members vote against the Government. It will then be the Government's duty to do everything possible to reduce the effect on people of the defence review. What is at stake is not only a defence review on strategy but the effect of that strategy on people's livelihoods, jobs and homes. With his Cabinet colleagues, the Secretary of State bears a great responsibility to do his best to reduce the effect.
The Secretary of State may intend to reduce the number of those employed at Portsmouth dockyard from about 7,000 to about 1,200 and to keep that dockyard in mothballs. If so, firms will not be able to provide alternative work. If the dockyard land is mothballed, there will be no land available for other firms because, as everyone knows, there is a grave shortage of land in that area. Therefore, there must be a decision on that matter.
Local authorities in the area are keen about this point. The Royal naval stores at Woolston occupies a large area of land in my constituency. About 100 men are employed there. That establishment is to close. If the land is sold to the highest bidder, a supermarket will buy the land for use as a warehouse and will employ only 100 men. However, that land could be used, in conjunction with the local authority, to provide a considerable amount of alternative employment. However, if the land is automatically sold off by the Property Services Agency to the highest bidder, it will not be put to such use. Planning should take place in conjunction with the local authority. That is why I welcome the working party that has been set up in Hampshire. I hope that a similar one is being set up in the Medway area.
I turn to a constituency interest, because Vosper Thornycroft is in my constituency. I wish to remind the Secretary of State of something that Lord Carrington said when he was the Secretary of State for Defence. lie said


that the then Government intended to use the three lead naval shipyards—Vosper Thornycroft, Yarrow and Vickers—for the majority of shipbuilding. When the Labour Government were in power I spent much time trying to persuade them, with some success, to maintain that position. There is always a danger that ships will not be built where they can be constructed most efficiently but that naval shipbuilding will be used as an adjunct of regional policy. There is always the possibility that shipbuilding will be done where unemployment is highest. So far, the policy of keeping those three naval shipyards has been maintained. Does that policy still prevail? Will the Government concentrate major naval shipbuilding orders on the three lead yards? Unless there is a continuity of orders at Vosper Thornycroft, there will be serious unemployment. When does the Minister expect the first orders for the new type 23? He gave 1988 as the finishing date, but when does he expect the first orders?
I understand that an acceptable design for the type 23 has not yet been found. The ship has not been properly designed. Therefore, when we talk about the type 23 we are talking about something rather nebulous. As I said. I am suspicious of the figure of 42 escort vessels at the minimum being available. I suspect that this White Paper will be followed by others. The right hon. Member for Devonport was right to say that Trident's cost will escalate. It is no good Conservative Members shaking their heads. Successive Governments said that the cost of Concorde would not escalate. The more the cost of Trident escalates, the more the Secretary of State will be told by the Treasury to make compensatory reductions elsewhere. I suspect that successive White Papers will make more and more cuts in our conventional forces. That is dangerous and could well represent a major threat to the security of this country.

Mr. Edward du Cann: I warmly endorse my right hon. Friend the Secretary of State's approach to what my hon. Friend the Member for Rochester and Chatham (Mrs. Fenner)—in her fine speech—called his difficult and complex tasks. I have two points to make, in which I shall try to explain why I endorse my right hon. Friend's approach. He has shown a notable sense of realism, as the right hon. Members for Down, South (Mr. Powell) and Plymouth, Devonport (Dr. Owen) said. Indeed, my right hon. Friend showed courage, which is not always a notable characteristic in politics. The speech by the hon. Member for Southampton, Itchen (Mr. Mitchell) was also noteworthy for its courage and for the hon. Gentleman's robust common sense in certain respects.
First, my right hon. Friend the Secretary of State is right to continue with a successor for Polaris. He said that it could not be gainsaid that the nuclear shield had kept peace, in world terms, secure. That has been the great gain of my lifetime and that of my children. However, as my right hon. Friend the Member for Sidcup (Mr. Heath) made clear in his notable speech, the strategy that underlies Trident's acceptance requires wider public debate than it has received. Parliament's role, both now and in the future, must be to move increasingly away from the mere endorsement of policies into the leadership of that debate. That is the task of us Back Benchers and is the

task, not least, of the Select Committees, including the Select Committee on Defence, which has made such a good beginning.
As my right hon. Friend the Member for Sidcup underlined, if peace rests on a balance of power, that balance must be set as low as possible. The corollary of my right hon. Friend's strategy and of the Government's task is that no opportunity should be lost to work long, hard, painstakingly and ceaselessly for multilateral disarmament and against proliferation. The public have been shocked by the thought that nuclear weapons may soon be in the possession of some of the smaller nations, of which Iraq is the latest and most outstanding example.
Secondly, the hon. Member for Pontypridd (Mr. John) may have been right—the hon. Member for Itchen commented on this point—when he said that this statement was an interim one. I hope so. My right hon. Friend the Member for Brighton, Pavilion (Mr. Amery), in one of the best speeches that I have ever heard him make in the House, said clearly that he wanted to see a greater defence capacity. I agree, though in a slightly muddled reply the right hon. Member for Devonport was right to ask the general question: what can we afford?
My right hon. Friend was correct to insist, in the total defence budget—which is, in absolute terms, over £12 billion—on what he called value for money. If, at a time of general economic weakness, the defence budget is to rise at 3 per cent. above inflation—that is a substantial increase—and the cost of advanced equipment rises faster than that, value for money is essential. If we mean what we say—that is what my right hon. Friend the Secretary of State said today—that the first obligation of the Government is defence of the realm, it follows that forces must be adequate for the purpose, and they demonstrably are not. To that extent, my right hon. Friend the Member for Pavilion was correct.
Does one need to emphasise again that we shall always be a maritime people? Modern technology, for all its brilliance, cannot change the lessons of history. Freedom of the seas is the keystone of the West's economic survival. More than 90 per cent. of our trade travels by sea, yet our capacity to protect it reduces constantly year after year.
Let us be clear about one matter that has been much discussed. My right hon. Friend the Member for Sidcup referred to it, as did the right hon. Member for Battersea, North (Mr. Jay). I understand that the intention is to cut 10 frigates out of the list and replace them by three Nimrod aircraft. There seems to be doubt about the figures, but if that is to happen it will be a sharp net reduction in Britain's ability to protect its sea lanes.
Looking back over my lifetime, I reflect that a few tens of enemy submarines at sea in 1945 requried no fewer than 5,000 escorts to counter them. The Russians, as the right hon. Member for Battersea, North pointed out, now have 400 submarines and search at sea is an extremely complex and difficult matter. Even to find one terrorist on land may require 1,000 policemen. In the face of this great advance by the Soviet Union, we have the smallest fleet that we have had for 300 years. Nor do we have the reserves of seamen and merchant ships, which might be the potential escorts of the future, that we had in 1939. That is all the more reason to maintain the fishing fleets that we have.
The vital services are suffering too. Hydrography is one example. I hope that in summing up the debate the Minister will have something to say about that. It is a


scandal—it is not the first time I have said this in the House, and I hope that it may be the last—that less than 30 per cent. of the United Kingdom continental shelf has been surveyed to modern standards. We have an ageing fleet. It is too small and the replacement programme is inadequate. As yet we have made no progress in the implementation of the 1975 study group proposals.
One could give many other examples, but that only shows that the cash may be increasing but our defence general capacity is reducing all the time. That is the great paradox. The current thinking in the White Paper appears to be that, because modern ships are so expensive, we must persuade ourselves that we can do without. Thus we are running huge risks. I do not believe that high quality is a wise substitute for ubiquity. One thing is certain: defence will become costlier. That is all the more reason to obtain better value for the vast sums that we spend.
The first ship that I ever served in in my short and undistinguished naval career during the war was what they called a Woolworth carrier—a converted merchantman. She was later sunk in one of those Arctic convoys after, as all those Woolworth carriers had, a most useful life. I learnt one great lesson on that ship—that weapons need not be expensive to be effective. Our naval strategy now is reliance on a strategic nuclear weapon plus only a limited capacity for defending part of the North Atlantic sea lanes. Yet the reality is that NATO's vital interests are by no means limited to our territories.
It is wrong for Britain apparently to turn her back on areas outside Europe as the Soviet strength grows and the mischief-making capacity increases in areas where, for the Soviet Union, less risk is involved. The truth is that the Soviets are using sea power, naval forces, the expansion of their merchant and fishing fleets now—today—as an instrument of world influence. We have the duty to counter that influence now. I believe that we can do it. I am certain that we can well afford the forces to play a wider world role, our traditional role, a role in global deterrence, disproportionate to the size of our capacity if we use our resources wisely.
Now I come to the reason why I said that I hoped the White Paper was an interim document from the Secretary of State. I am certain that the scope for economy in the £12½ billion expenditure is vast. My right hon. Friend is moving in the right direction, cutting the infrastructure—however hard, difficult and miserable that may be for all of us involved—but making certain that the front line is intact or increases. No activity in defence should be sacrosanct or safe from questioning.
I can give some examples where my right hon. Friend might look for further savings in the costs. First, civilianisation has been enormously expensive. Secondly, we have too top heavy a brass. The Under-Secretary of State for Defence Procurement, my hon. Friend the Member for Chertsey and Walton (Mr. Pattie) will remember that when he and I were members of the Public Accounts Committee we drew attention to the fact that there were more admirals in the Navy than there were ships of the line.
I should like to see my right hon. Friend take a scalpel to the bureaucracy in the defence departments. Why are 25 per cent. of all Service personnel tied up in training establishments? Why is it necessary for the forces to have their own universities? Procurement is another problem. Here is a field indeed. Standardisation, specialisation and competitive tendering may be matters as much for the

Alliance as they are for us. Let us import some political will and consider whether some of the most senior officials in NATO should not now be replaced, after many years' loyal service, by younger and more active people.
Let us introduce private enterprise wherever we can and, above all, let us aim for less complication in our ships. It is discreditable that there have been no overseas sales of British-made warships in recent years. My right hon. Friend is correct to go for cheaper and simpler designs. How good it was to hear his challenge about Vosper in the early part of the debate. I hope that he will look again at "Osprey". That is an outstanding design which is more satisfactory than the long, narrow-gutted ships that we are using today. For too long, we have allowed the excellent to drive out the good and defence has cost us considerably more than it should as a result.
The Economist put it well this week when it made the point that NATO spends more in absolute terms on defence than the Warsaw Pact countries. However, we get less for each dollar that is spent, and that has really been the failure over many years.
I repeat that I am certain that my right hon. Friend is on the right lines. I hope that he will continue strongly with what he is attempting to do. I believe that we can strengthen our defences in spite of our unhappily, and I hope temporarily, limited resources. That is the challenge which faces my right hon. Friend and the Conservative Party and it is one which I expect us to live up to.

8 pm

Dr. John Gilbert: Let me say, as the Secretary of State leaves the Chamber, that I find myself in agreement with several things in his White Paper. As he knows, I have always supported a switch of the Tornado IDS force from a maritime role to Royal Air Force Germany. I always believed that it was nonsense that about 45 per cent. of our complement of those expensive and useful aircraft would be used in that role. I support also a subsequent shift of balance of the Tornado from the IDS version to the ADV version, which is something that I have also commended to the House from time to time.
There are also various other things in the White Paper that I can support, such as the arming of Hawks. There is nothing new about that. The Secretary of State did not start it. It was started by the Labour Government. As for the stories that we have heard today about the time that it will take to bring in the type 23 frigate, I can tell the right hon. Gentleman that we were trying to get the admirals to agree to something like the type 23 frigate back in 1978.
Having said that I agree with various things in the White Paper, I say straight away that I quarrel fundamentally with the decision about Trident. I shall not go into the reasons now. They are set out in the minority report of the Select Committee on Defence, which I and some of my hon. Friends put forward for the consideration of the House.
However, I take issue with some of the things that the Secretary of State has been saying—and I shall say that several times today. He talked today of our need to ensure that Soviet special forces and forces on the central front could be held so that reinforcements could come from North America "in succeeding months". There will be no succeeding months. If there is conflict in Western Europe, if we are lucky it will be over in weeks. If we are unlucky, it will be over in days or hours. It will certainly not run into succeeding months. It is a cruel and dangerous illusion


to seek to persuade the British people that any future conflict involving NATO and the Warsaw Pact powers will be fought over a series of months in which there will be time for reinforcements to come over on a massive scale from North America. God help us, but if there is another war in Western Europe it will be fought with the weapons and men that are there when the conflict breaks out.

Mr. John Browne: Would the right hon. Gentleman consider a scenario in which Europe could effectively be strangled or emasculated by activity, even under a so-called strategic peace, way outside Western Europe? We may not be fighting in Europe, but there would effectively be an escalation to a war, and the battle may be many weeks after the initial escalation that would take place in Europe. Hence the need for reinforcement.

Dr. Gilbert: If the hon. Gentleman will be patient, I shall come to that point.
I said that it was ridiculous to imagine a war at sea continuing after we had all been incinerated in Western Europe and then a fresh surge of war, as it were, with troops and munitions of war coming from North America. I do not believe that the Warsaw Pact powers would be prepared to watch 1 million or 2 million men arriving from North America with all their kit, equipment, war stocks and ammunition. Equally, I do not believe that NATO would tolerate a war at sea during which our ships were being sunk without retaliation on our part in ways and methods of our own choosing.
Equally—I come now to the point raised by the hon. Member for Winchester (Mr. Browne)—I do not believe that the Secretary of State can or should play with ideas of intervening on a massive scale with forces in the Gulf or in the Indian Ocean. The problems there are political. They are not capable of solution by military means—at least not on the part of Western powers. If all the pipelines were blown up, all the naval and air forces of the United Kingdom, the United States and NATO put together could not put them back in working order. We should be powerless to get them to work again.
Would the Secretary of State seriously have used his two new aircraft carriers, which he talks glibly of using in out-of-area roles, to try to sustain the Shah? A fat lot of good that would have done him. Would he have used them to intervene in the Iraq-Iran war? That idea is preposterous. Would he have used them to try to sustain the Saudi Royal family if there were a revolt against it? When one considers scenario after scenario that could have serious consequences—I agree with the hon. Member for Winchester—for our economic survival, it is clear that armed forces based in Western Europe are irrelevant for any such capability.
I do not wish to talk for too long, so I come straight to the question of the nuclear threshold. The Secretary of State clearly has a guilty conscience about this. He said several times, not only today but at the time of his statement, that the measures in the White Paper would raise the nuclear threshold. Let us be clear about this. Possessing Trident does not of itself lower the nuclear threshold. The acquisition of Trident restrains the Secretary of State's power to raise the nuclear threshold, the reason being the opportunity costs that Trident represents. Even the Secretary of State now has to admit that, if he buys Trident, he cannot buy many other things.
I repeat that some of the right hon. Gentleman's remarks in public baffle me. I watched him last night on television. He put to the interviewer, or to the British people, "I ask you, would the Russians be more afraid of Trident or of 100 extra tanks?" The answer is simple. If that is the arithmetic being done in the Ministry of Defence, frankly I am a little worried. When I was there, £500 million, which is the cost of Trident, would have brought 5,000 tanks, which is a different equation to strike.

Mr. Churchill: Not 50 armoured divisions.

Dr. Gilbert: Indeed. I shall come to that point. Obviously there is a difference between capital and running costs, but I am making the comparison that the Secretary of State made last night on television, which was totally erroneous and misleading.
Our total tank force in Western Europe is about 600, so, with the cost of Trident being about 5,000 tanks, we can see what we are forgoing merely in terms of capital costs to acquire the Trident programme.
What will determine the nuclear threshold, if there is one? The danger is that there will not be a nuclear threshold, or at least that it will be over in the first half-hour. In other words, any major conflict in Western Europe would be fought from the beginning with a range of nuclear weapons, whether battlefield, theatre or strategic. However, the concept of the nuclear threshold depends on rebutting that proposition. The whole concept is that there will be a period of conventional war, followed by a period of nuclear war. I always believed that that was a simplistic concept, but that is what the Secretary of State is talking about when he talks of raising the nuclear threshold.
In so far as those matters are within the power of NATO to control, the decision to go nuclear will be forced by the choice of either doing so or surrendering. If we get to that point, let us be clear: the deterrents will have failed and the vast expenditure on Trident will have proved futile.
However, to come to the practicalities of the matter, if we are at the point of the nuclear threshold, the choice will be determined by one of two things—the staying power of First British Corps or of RAF Germany. The Secretary of State told us that, as a result of his measures, the former was being enhanced by 20 per cent. to 30 per cent. What is meant by that enhancement of staying power?
Is the Secretary of State saying that, as a result of his economies, he will put back the nuclear decision period by 20 per cent. or 30 per cent. beyond the current planning assumptions of the Ministry of Defence, or is he saying that, although the Ministry has planning assumptions, they cannot be achieved because of the shortfall in war stocks and ammunition and that he is bringing them up to a level that can be correlated with his planning assumptions? I suspect that the latter is the case, but I may have read the situation wrongly and I would be reassured to be told that I am wrong.
The point is that, even if the Secretary of State has raised the nuclear threshold by 20 per cent. or 30 per cent., we are talking not about months or weeks but about only a few more days. I hope that the British public will not be lulled into a false sense of comfort by the Secretary of State's easy assurance that he has raised the nuclear threshold by 20 per cent. or 30 per cent. On the assumption that I am wrong, all that the right hon. Gentleman has


succeeded in doing—at best—is giving us another couple of days' breathing space before we are forced to go nuclear.
All that the Secretary of State said was that he was raising the staying power of First British Corps by 20 per cent. or 30 per cent. He said nothing about increments in the staying power of RAF Germany. That was a significant omission, because the staying power of First British Corps depends crucially on the staying power of RAF Germany.
I am glad that the Secretary of State has tried to alter the balance between weapons platforms and war stocks and ammunition. The previous Labour Government, of which I was a member—I confess to my share of responsibility—probably got the balance wrong, though we did not get it as wrong as did some of our European allies.
It is not good enough to increase stocks of air-to-air or air-to-surface weapons. We can get out of balance in that direction as well. The staying power of RAF Germany is a function of attrition rates, which are a function of sortie rates and the consequent loss and damage incurred to aircraft, and attacks on our clutch airfieds, with the exception of Harrier.
What has the Secretary of State done to reduce attrition rates? There was nothing in the right hon. Gentleman's speech or in the White Paper about going from Rapier field standard 1 to field standard 2 and on to field standard 3. Unless the Government are prepared to contemplate the expenditure involved in going to field standard 3 for Rapier, they will be able to do little to reduce the attrition on our four clutch airfields in RAF Germany. I am sure that the British public do not realise that we will operate the entire RAF Germany force from only four airfields in time of war.
I do not criticise the Secretary of State if he has not succeeded in significantly raising the staying power of RAF Germany. I do not believe that he could do so. But that is one of the true costs of the Trident system. Much of an extra £5,000 million for hardware could be spent on enhancing the defence of our airfields. That would not involve many more men. It would be almost a straight swap from one type of hardware to another. The Secretary of State said nothing about that.
I doubt whether the Secretary of State's economies have raised our total nuclear threshold by much. If they have, it will be by only a day or two. I do not believe that the right hon. Gentleman can do that. It is not within his power to do so, especially if he intends to persist with the acquisition of the Trident system. But, if he cannot do it, he should not pretend that he has done it. It is a dangerous deceit to practise on the British people to claim that the Government have done much more in raising the nuclear threshold and that we should feel safer and grateful to the Secretary of State.
The right hon. Member for Sidcup (Mr. Heath) made an admirable speech. I agree with him that there must be some sign from the Government that they are seriously interested in arms control and limitation and, ultimately, disarmament. In God's name, there must be some sign. We have yet to hear a single proposal during the Government's tenure of office to show that they have any ideas to put to the British people or to the world that they care about, or are interested in, arms limitation.
Lip service is paid to the idea, but we have not heard a single practical suggestion. I am not making a political point, but if the Government do not soon produce urgent

and comprehensive plans for reducing the burden of armaments on this country and the rest of the world, the task of all of us on both sides of the House in persuading our constituents to pay the money that is necessary for our defence will be vastly more difficult, if not impossible.

Mr. Keith Speed: I hope that the right hon. Member for Dudley, East (Dr. Gilbert) will forgive me if I do not follow him down the interesting road along which he took us. The debate has been remarkable because most hon. Members have referred to their worries about the shortfall in maritime capability, particularly in regard to the surface fleet, and a number of hon. Members on both sides have been perplexed about what the White Paper means in terms of the rundown of the surface fleet. Even the exchanges with my right hon. Friend the Secretary of State did not shed much illumination on that murky subject.
I shall try to illuminate the subject. I have been doing researches, and if I am wrong perhaps the Minister who is to reply to the debate will correct me, but it seems to me that the facts are as follows. I calculate that this year, including the cuts made in January—the debate takes place against a background of those cuts—decisions will be taken to dispose of 26 destroyers and frigates over the next three or four years.
Those ships will be the County class and a number of the Leander class, the Rothesay class and type 81 frigates, plus the eight Leanders that are to go into what has been called deep reserve. I agree with hon. Members who have said that, because of the rundown, particularly in the Chatham and Portsmouth dockyards and the fact that the Leanders are probably unmodified ships, they will not he of enormous use because it would take 30 days or more to make them fully operational. So that is about 34 destroyers and frigates that we shall not have.
In addition, it is fair to add the three carriers, "Bulwark", which was disposed of early, admittedly only by a few months, "Hermes", which will be disposed of early, and presumably one of the three Invincible class. Having read the White Paper, I presume that it will be "Invincible". There is also the cruiser "Blake", the disposal of which was announced in January. The two amphibious warships, "Fearless" and "Intrepid", are being disposed of early, plus the Arctic survey and patrol ship "Endurance", plus three tankers and one stores ship of the Royal Fleet Auxiliary—all are to go.
On the credit side, there are currently seven type 42 destroyers being built plus, including the order that: my right hon. Friend announced on 25 June, four type 22 frigates. That is a total of 11 destroyers and frigates being built. To be fair, we should add "Illustrious" and "Ark Royal" to set against that rather long list of ships that are going. According to my calculations, that means a reduction in the major surface fleet—by which I mean ships of frigate size and above—of about 34 to 35 per cent. over the next four to five years. That is a substantial reduction in anyone's terms.
My right hon. Friend the Member for Taunton ( Mr. du Cann), in his interesting speech, much of which I agree with, talked about the importance of the capacity to protect our trade. The right hon. Member for Battersea, North (Mr. Jay) made the same point. In 1970, the Navy had five carriers. By 1986 the figure will be down to two. In 1970, the Navy had two assault ships, and, of course, by 1986


it will not have any. In 1970, the Navy had three cruisers and by 1986 there will be none. In 1970—this is an interesting figure—the Navy had 81 destroyers and frigates, and by 1986 the figure will be either 50 or 42, depending on whether one includes the eight in reserve.
The Royal Fleet Auxiliary vessels are important from the point of view of logistic support to the fleet, particularly for the out-of-area deployments. In 1970, there were 46 Royal Fleet Auxiliary ships, and by 1986 the figure will be down to 25. There has been some discussion about these 42 operational frigates, and I agree with my hon. Friends that, although frigates will not be included in the modernisation programme, there will be frigates in dock, frigates with essential defects, frigates undergoing maintenance periods, repairs to engines and so on. The same is true of destroyers. So, in practical terms, the Commander-in-Chief (Fleet) will be lucky if he has more than 33 or 34 operational frigates to play with. Again, if I am wrong on that I hope that my hon. Friend will tell me so.
I am disappointed that we are to have only 17 submarines by the end of the decade, because I believe that that is a slight reduction on what was originally planned. In his statement on 25 June, my right hon. Friend the Secretary of State announced the order of No. 16, which leaves only one to go. I share the apprehension of a number of right hon. and hon. Members because one or two of our nuclear submarines, certainly "Dreadnought" and possibly one or two others, will be pretty old by the end of the decade. Because of capacity problems, unless we can open a new line at Cammell Laird—there are strong arguments for that, but it will cost money—I think that 17 will be the end of the line for a considerable period. That figure of 17 will be reduced as the older submarines, first "Dreadnought" and then other submarines of the Valiant class, have to be scrapped purely because of age.
Another worry that I have, which has not yet been mentioned or if it has been mentioned it has been mentioned in terms of approbation rather than condemnation, is the decision not to modernise ships. Here, we come directly back to closing Chatham dockyard naval base and running down Portsmouth. I know that the figure of £70 million that my right hon. Friend has quoted for Leander class frigate modernisation is substantial. However, I think I am not being unfair if I say that that is at the top end of the range. I know that there are ships of that class and the Rothesay class that have been modernised. Indeed, I was aboard one in January that had been modernised at a considerably lower sum. However, I accept the point that my right hon. Friend makes in the White Paper that we are spending tens of millions of pounds on modernisation.
At the end of the day, a modernised Leander with Sea Wolf, a Lynx helicopter and possibly the Ikara antisubmarine weapon or Sting Ray and surface torpedo tubes, or whatever, will still have a better capability than the new type 23 frigate. Unfortunately, one gets what one pays for. I think that that is how it will work out.
The type 23 will be a new ship, and therefore many new ideas will be brought into it and it will be much more economical in the use of manpower. It will have various other ideas that the designers have introduced, because it will be designed for the late 1980s as compared with the Leander class, which was designed in the 1960s. But, as regards the kit, let us not run down the Leander, which I

believe to be one of the best frigates that the Royal Navy has ever had. It is currently giving excellent service with the navies of the Netherlands, New Zealand and India, to name but three in other parts of the world. Unfortunately, the Leander class frigates are some of the key frigates, the escort ships, that we are to lose in the Atlantic.
Incidentally, it is all right to modernise the Nimrod to Nimrod II, using the existing airframe and putting in updated avionics. However, the airframe is perhaps 12 years old, and quite a lot of the Leanders that are not to be modernised but may be disposed of are about the same age. I am not quarrelling with updating. If one has a good airframe, tank or ship, it makes a great deal of sense to put modern sensors and weapons in it. One can produce a more capable weapon sometimes than by building new.
One of my worries about the lack of modernisation concerns the type 42 destroyer, for example, which is the Navy's main air defence ship and also has quite a good anti-submarine capability. I am not talking about the Sea Dart II, which I entirely agree was an extremely expensive modernisation, which could not have been afforded,. But if the ship's existing Sea Dart air defence system is not to be enhanced even to a modest extent, I am worried that by the mid-1980s its air defence capability will be obsolete, no longer capable of dealing with the threat.
Then, the successor but two or three to my right hon. Friend the Secretary of State may say "The first of this class, the 'Sheffield', entered service in 1974, and here we are 10 or 15 years later. It is obsolete. Its main armament is no longer capable of meeting the threat. It will be the next to go" That would mean 14 type 42s gone straight away. I am concerned about the gap between the type 23s and what we have now.

Sir Frederick Burden: Will my hon. Friend clear up one point that has worried me a great deal? On behalf of the Government, he issued a statement that the Royal dockyards would be needed. I assume that that statement was made after careful consideration and was based on the country's defence requirements. If that is so, how does he account for the complete reversal of that statement within 10 months? It seems to me to put a large question mark over the original decision or over what is happening now.

Mr. Speed: That statement was the result of the dockyard study, of which I was chairman. It looked fully at the fleet in being at the time and at what was expected. The study believed that four home dockyards were needed, and that view was endorsed by the Government. If the mix of the fleet is altered, and we do not have so many surface ships, the Government are presumably entitled to take a different view about the support, and no doubt that was in my right hon. Friend's mind. However, that was the view of the study team, based upon the fleet in being last August.

Sir Frederick Burden: And expected.

Mr. Speed: Yes, at that time. Clearly, matters may change. My hon. Friend the Minister of State can deal with the question when he winds up the debate.
I agree with my hon. Friend the Member for Tynemouth (Mr. Trotter) that we should now be thinking of ordering three ships, at least to maintain the numbers—42 to 50—that my right hon. Friend talked about. We are going to have an enormous gap. I believe that, after the one type 22 that has been ordered, no further


frigates or destroyers will be ordered. The next major surface ship to enter service after the existing ships have been built will be the type 23 in the late 1980s. That will be the first of class. There is inevitably a gap between the first of class and the follow-ons. I am concerned that the lack of modernisation means that those Leanders not already modernised will not be modernised and the capability of the type 42s will not be enhanced. This worries me very much.

Mr. Cormack: Does this not mean that we shall be at our most vulnerable at the point of greatest risk?

Mr. Speed: There are arguments about the point of greatest risk. I believe that the Soviet maritime threat has never been greater. I think that I carry most hon. Members with me when I say that if there were to be a conflict of any kind we should not have the two years that we had during the last war to build modern ships. What we have, when the crisis comes, we shall have to use.

Mr. Trotter: Does my hon. Friend not agree that it is at least as important that we have a substantial on-going frigate ordering programme as that we have these cuts? The effect of not having a substantial frigate programme would be at least as serious as the cuts that have been announced.

Mr. Speed: I believe that it is important to keep the capability of the three yards—Vickers, Vosper Thornycroft and Yarrow. That can only be done, as the hon. Member for Southampton, Itchen (Mr. Mitchell) and other hon. Members have reminded the House, if there is a continuity of work. I believe in cheaper ships, cheaper platforms and cheaper weapon systems. I do not resile from that view. I stated that view in my now notorious Tenterden speech. I worked for it during the whole time I spent within the Department. However, these things take time to design, to order and to produce.
I see a first and second eleven. The first eleven consists of high-quality ships like the type 22, limited in numbers, backed by the second eleven of capable but much cheaper type 23s. I hope personally for one and possibly two more type 22s to fill the gap in the period of time.
In the minesweeping programme, we have the Hunt class mine counter-measures vessels. They are marvellous ships but very expensive, as I am sure my right hon. Friend agrees. They should be backed by the single role minehunter which is much cheaper. A great deal of work has been put into it.
Paragraph 23 of the White Paper talks about enhancing our maritime and submarine effort. We shall lose a third of an anti-submarine warfare carrier. As the White Paper makes pretty clear, one of the three Invincibles will go. Those carriers carry nine Sea King anti-submarine helicopters plus five Sea Harriers, which I am pleased to see will be armed with Sea Eagle, the excellent air-to-surface anti-ship missile.
We are also losing at least 17 frigates, and destroyers will drop from 59 to 42, together with their helicopters plus the lack of modernisation to the surface ships I have mentioned and the loss of the Royal Fleet Auxiliary vessels. This has to be equated with the three additional Nimrod Ifs. This involves the conversion of Nimrod I to Nimrod II. I believe that I am right in saying that there are really only two. I think the third is to replace the Nimrod II that crashed last November. If that is wrong, I am subject to correction in the Minister's winding-up speech.
Whether it is two or three, I do not think that the number equates with the carrier, Sea King helicopters, Sea Harriers, 17 frigates plus helicopters together with all the rest. I cannot see how this enhances our maritime aim, especially at the anti-submarine end, while the SSN effort has not been enhanced over what was planned. If anything, it has been marginally reduced.
My right hon. Friend the Member for Taunton made a number of interesting suggestions for savings in the Ministry of Defence. To be fair to my right hon. Friend the Secretary of State and his ministerial colleagues, they have been seeking to achieve savings over a period, as did my right hon. Friend the Leader of the House before them. I should like to flog my particular hobby horse. The issue has been touched upon by the right hon. Member for Cardiff, South-East (Mr. Callaghan) in a previous defence debate.
I have no desire to cut back the sharp teeth of BAOR. I think, however, that we should start to question the £700 million a year plus support costs largely paid in deutschemarks. Does it make sense to employ 23,000 to 25,000 German civilians? I do not know how many of their jobs will be lost under the defence review. My hon. Friend the Minister has many questions to answer. It would be interesting if he could say how many jobs may go.
A more imaginative housing scheme for the Army, together with a more imaginative transport arrangement for BAOR, would be of great benefit. The BAOR from the South-East of England or from Aldershot is not much further than from many parts of Scotland and Northern Ireland. Spending £50 million or even £100 million on such imaginative arrangements would save a great deal of the £700 million that we spend, year in, year out, on the houses, shops and schools for families in BAOR. That does not add anything to BAOR's teeth. Let us be honest: when a conflict comes, the families will be a thundering nuisance immediately behind the front line. We could make some substantial savings in that area.
The unemployment problems, which are human problems, have been mentioned by hon. Members on both sides of the House. I am concerned that there may be major redundancies among both the civilian staff and the Service staff, officers and other ranks alike. I am concerned about the consequential job losses that will ensue. The level of unemployment is high enough. I shall be bothered if it gets any higher. At the end of the day we shall have to pay for that in various ways, such as unemployment pay and social security benefits. That is another side of the coin. Obviously, it is not the concern of my right hon. Friend who wears the Ministry of Defence hat. We must all ensure that we do not create an even larger public sector borrowing requirement. Real human problems arise whether someone is seeking a career in the Service, in the dockyards, in the pubs outside the dockyards, or with the subcontractors who have worked for the past 10 years at dockyards such as Portsmouth.
What happened to the concept of NATO burden-sharing that my right hon. Friend the Leader of the House put forward to NATO last Christmas? If the Alliance means anything at all, each country must contribute what it can do well. Britain has a unique capability. Our national interest and Alliance interest is our Royal Navy and the maritime interest. We can do that well, as can the Dutch. Other NATO countries do other things well. If burden-sharing and the Alliance mean anything, that


initiative—which I applauded at the time—should have been pursued with more vigour by NATO Ministers and the new Administration in the United States.
The cuts of 35 per cent. in the major surface fleet, the failure to enhance our nuclear submarine programme, a reduction of 16 per cent. in Service manpower and the considerable cuts in fleet support, especially the dockyards, are of great concern at a time when there is a growing and major maritime threat—possibly the largest maritime threat ever--from the Soviet Navy. It is all set to overtake the United States Navy, both in size and in worldwide operations.
It was no part of our election programme to reduce the Navy in the number of ships, their quality or their manpower. That is a gamble with our national security. It is a gamble within the Alliance. I fear that other European countries might follow us down that path, which would be even more dangerous. That is why, with the greatest regret, I cannot endorse the White Paper.

Mr. Deputy Speaker (Mr. Bernard Weatherill): Before I call the next speaker, I remind the House that the Front Bench replies will begin in about half an hour. Many hon. Members still wish to speak, so I hope that speeches will be limited in length.

Mr. A. E. P. Duffy: It is with great pleasure that I follow the hon. Member for Ashford (Mr. Speed). I had wished to touch on some aspects of his important speech, because it was a valuable contribution to our debate. However, time does not allow me to do that.
I cannot resist saying a word about the hon. Gentleman's arithmetic on the number of surface ships that he thinks will survive the review. He brought the number down to 42. I think that he will agree that at any given time a number of our surface units will be in the hands of the dockyards. On occasions as many as one-third of those units have been in the charge of the dockyards. A cut of 50 per cent. would bring down the number of units to about 35. If we make allowance for the Belize guard ship, one ship in the Caribbean, two in the Gulf and two on passage, we are down to 29. The right hon. Member for Plymouth, Devonport (Dr. Owen) said that in his experience as Foreign Secretary there was never a frigate to spare. I can never remember a time when there was not over-stretch in the Navy department.
The right hon. Member for Brighton, Pavilion (Mr. Amery) said that the name of the game of Alliance strategy was deterrence. It is vital that we bear in mind that deterrence depends upon a flexible response. That means conveying to the Russian planners that there is no scenario, whether it be a long or a short war, that they can pursue with advantage. I do not believe that the Soviet Union wants a war that would follow a dramatic confrontation on the Western front in Europe.
Such a conflict could give rise to two consequences from which the Russians would shrink. The first is a nuclear holocaust. I do not believe that they want that any more than we do. The second is a reunited Germany, under Eastern Germany or Western Germany. The Russians do not want that either. However, the Soviet Union is capable of trying the nerve of the West for a long time.
That is where the danger lies. One side or the other may slide into a fatal posture of confrontation as a result of a

misjudgment, and something much worse may arise. That will be so unless we can match all the possible scenarios and options short of war. That is the test that I apply to the Secretary of State's defence review.
Within the context of the choices that the right hon. Gentleman proposes, it seems that we are departing from that strategy. Does he agree that we should be able to present a flexible response? If so, his Trident intentions add nothing, because the United States has a surplus of capacity in that respect. His intended cuts in surface ships strike at the other end of the flexible response spectrum. However, he has claimed—I thought that my right hon. Friend the Member for Dudley, East (Dr. Gilbert) dealt with this extremely effectively—that one result of the defence review is to raise the nuclear threshold.
The right hon. Gentleman is reducing Britain's maritime role, to which he is historically bound, and is therefore abandoning centuries not only of naval tradition but of fulfilment. The right hon. Gentleman insisted that he had no choice but to cut the surface fleet, given the cost pressures. What are his priorities? What is the role of the Royal Air Force and that of the Army? What is the balance of priorities? If there are grounds for specialisation in NATO, that must mean that the United Kingdom enhances its maritime capability rather than sustaining, for example, a Continental army.
I believe that the BAOR is the best army in Europe. However, Britain is the only country that provides a full-time Continental army. With the greatest respect to our Army, I do not believe that it is the Russians' main priority. They are interested primarily in the 1½ million German reserves. I should like to see the Army deploying more and more of its men on emergency tours from the United Kingdom base.
The final major judgment of the Secretary of State for Defence to which I take strong exception relates to surface, opposed to sub-surface, ships. NATO still includes 14 sea-going nations. The merchant ships of those nations comprise about 65 per cent. of the world's merchant fleet. The average sailing day still finds about 3,000 ships at sea in the area with which NATO is chiefly concerned. Accordingly, any possible threat to the reinforcement of Western Europe is crucial, and the ability of the Royal Navy to maintain the edge in anti-submarine warfare is even more important in priority terms than the United Kingdom's air defence system.
I hope that none of my RAF friends will misunderstand when I say that I am in no way impressed with the Secretary of State's announced intention to arm Hawks to preserve the integrity of the skies around Britain. Nor do I think that the maintenance of the BAOR in its present form ranks with the priority of maintaining our antisubmarine warfare commitment in the East Atlantic and the Channel.
Our maritime forces are primarily designed for antisubmarine warfare. They comprise a variety of platforms and systems, and there has always been some debate over their relative importance, given the changing nature of the threat. What is now at issue—this is probably the crux of the matter—is whether the increasing reliance of the Secretary of State on a reduced mix of SSNs and maritime patrol aircraft will prove adequate to the task.
It is extremely unlikely that he will have received unreserved and unqualified professional encouragement. Nevertheless, the right hon. Gentleman has become convinced that it is possible to confine Soviet submarines


to the Norwegian sea, with the aid of a barrier operation such as NATO might operate between Greenland, Iceland and the United Kingdom, as well as the deployment of SSNs and MPAs on search and destroy missions.
Even those analysts who are of the same frame of mind as the Secretary of State see the necessity to plan for the defence of convoys across the Atlantic in the event of hostile submarines being pre-deployed in the Atlantic in the event of a breakdown in the anti-submarine barrier across the Greenland-Iceland-United Kingdom gap or in the event of the emergence of a scenario different from that described by my right hon. Friend the Member for Dudley, East.
My right hon. Friend got dangerously close to saying that it would be a short war. Frankly, once we become reconciled to a short war, I believe that we have lost it. In any event, over the last two or three years there has been ample evidence in Soviet specialist literature, as well as in the changing pattern of Soviet naval exercises, that the Russians are becoming increasingly interested in the interdiction of our sea lanes of communications.
SOSUS was until recently a hush-hush word, but it is now often mentioned in American specialist literature, so I think that I can safely mention it in the House. That is not the whole answer. To the best of my knowledge, it is very good, but it has its limitations. Is the right hon, Gentleman justified in his adoption of such a high-risk strategy?
There is also the Secretary of State's arithmetic. We shall all want to look closely at the Hansard report of the hon. Member for Ashford (Mr. Speed), who is in a position closely to investigate that arithmetic. I am prepared to go even lower in numbers than he did. Analysts with whom I have discussed this matter in recent years were all considering a number of escort vessels way above the figure to which the Secretary of State is now obviously reconciled. I do not know of one analyst who is prepared to go down to as low a number as the Secretary of State. In fact, even at the lower end of their thinking—for obvious reasons, 1 do not want to go into figures—it was agreed that perhaps only half the military shipping requirement, and, therefore, less than one-quarter of the military and economic shipping requirement combined, could be achieved. To provide additional escort ships would be at the expense of other vital tasks.
We must consider the possibility of having escort vessels in the region, for a number for which there is no specialist support. At the highest professional and command levels in the Alliance, I continue to hear endorsements of the effectiveness of the SSNs and the MPAs. I also continue to hear calls for more escort vessels. The ready acknowledgment of the importance of SSNs and MPAs serves only to emphasise the continued need for surface ships.
The SSN is undoubtedly the most effective weapon platform for anti-submarine warfare, particularly against deep-diving, nuclear-powered submarines. The MPA is also effective operating autonomously. Some critics believe that its detection rate is on the low side. For both SSNs and MPAs to operate effectively, they require information from other sensors which can be filtered effectively only by surface ships. Therefore, the role of surface ships is crucial here as well—in terms of command, control and communication.
We heard what the hon. Member for Ashford said about the introduction of helicopters and how they have

increased the effectiveness of surface ships, including the through-deck carriers. I know that the Secretary of State is embarrassed about the replacement of the Sea King. If he is thinking of dispensing with such a replacement, and if that affects his thinking on the anti-submarine carrier, we can say goodbye to a seaborne anti-submarine deterrent.
Effective anti-submarine operations involve not only the integration and orchestration of all existing scarce resources but maximum co-operation on a multinational Alliance basis. I hope that we shall examine the Secretary of State's proposals against the background of the strategy and objectives of the Alliance and bearing in mind also what the hon. Member for Ashford said about burden sharing.
I know that resource allocation has been a problem for some years. There is no new climactic factor with which these persistent budgetary pressures cannot be reconciled, either in systems or in doctrine, unless it is Trident. There is no development which can call into question so urgently the future size and shape of the Royal Navy, unless it is the insistence of the Government on maintaining the appearance of an all-round contribution by the United Kingdom to the Alliance instead of a balanced contribution based upon balanced priorities.
The Secretary of State expects most Conservative Members to support him tonight. I believe that he will have to satisfy his Back-Bench colleagues that there is no unnecessary sacrifice of surface ships, that he is not downgrading the Royal Navy and that he is not destroying the Royal Navy's morale. For the right hon. Gentleman to look for any semblance of support from Opposition Benches, he will have to satisfy us that there is no unnecessary sacrifice of industrial jobs in dockyards, in shipbuilding yards and in the engineering, electronic and ancillary industries that equip surface vessels.
Above all, the Secretary of State will have to convince a Parliament which, as is clear from the significant speech of the right hon. Member for Sidcup (Mr. Heath), is increasingly sensitive to the need for arms control, that his definitions of rationalisation and cost-effectiveness will not lower the nuclear threshold either in regard to the deployment of SSNs and MPAs with their nuclear weapons potential or in regard to the supply of the central region of Western Europe, where a lowered nuclear threshold could be the direct consequence of a high risk strategy in the North Atlantic in relation to reinforcement and supply.

Mr. Churchill: It is a pleasure to follow the hon. Member for Sheffield, Attercliffe (Mr. Duffy), a former Navy Minister, who brings such knowledge lo our deliberations.
In the 12 years that I have had the privilege to serve in the House I have never before felt impelled to table a motion, as I have today, critical of my own party's overall defence policy. I do not do that lightly. However, I wish to make it clear that I have no argument with the broad sweep of my right hon. Friend the Secretary of State's proposals as outlined in his White Paper. It is the skilful curate's egg that one has come to expect of him.
I welcome many of my right hon. Friend's proposals since they are likely to provide the most cost-effective defence for our nation within present budget constraints. However, it is with those budget constraints that I and at


least 10 of my right hon. and hon. Friends who have joined me in signing my amendment—which has not been selected—wish to take issue. We believe that this is no time for the Government to be cutting the capabilities of Britain's Armed Forces. The truth, however uncomfortable it might be for the Government, who were elected on a pledge to strengthen our defences, is that their present plans call for a substantial reduction in defence capability in several spheres, at least until the 1990s when the type 23s, Trident and other weapons systems come into service.
It is clear that the Government intend to reduce the Royal Navy's surface fleet by no less than 25 per cent., according to the Secretary of State's figures, and by about 35 per cent., according to the figures advanced by my hon. Friend the Member for Ashford (Mr. Speed). The Royal Navy's role is not only that advanced by my right hon. Friend the Member for Sidcup (Mr. Heath) of ensuring the safe delivery to Britain and West Europe of our oil supplies in time of crisis but of providing for the safe passage across the North Atlantic in time of tension or war of no fewer than 1 million American reinforcements, 10 million tonnes of equipment and 100 million tonnes of stores. About 95 per cent. of that must go by sea, despite the massive airlift capability of the United States.
It is disturbing that the Government should decide to embark on a major programme of cutting surface escorts when the United States Government are planning to embark on a crash programme of increasing their surface capabilities.
It is clear that manpower cuts of about 20,000 in the regular Armed Forces are now to take place. Understandably without any fanfare, the Government have, by default, taken the decision not to renew Britain's theatre nuclear capability once the Vulcans pass to the scrapheap in the next year or so. That represents about one-third of NATO's theatre nuclear capability.
The Secretary of State justifiably accused the Opposition of singing the Kremlin song. It is facile in the extreme for the Leader of the Opposition to peddle Mr. Brezhnev's propaganda for the moratorium on the deployment of theatre nuclear forces when the Soviet Union has just deployed no fewer than 200 SS20 mobile, intermediate-range ballistic missiles and a further 150 Backfire nuclear strike aircraft. That triples the numbers of nuclear warheads targeted on the cities of Britain and our Western European allies in the space of five years. That programme is almost completed.
NATO's modernisation programme is about to be embarked upon. The rest of our capability is becoming obsolete in the form of the Fl 11s and the Vulcan bombers. It is irresponsible of the Leader of the Opposition to advance the proposals of Mr. Brezhnev and to say that we should welcome the moratorium that he has proposed at this time.
I ask my right hon. Friends how they believe that this weakening of Britain's capability in the short term will be viewed by the Kremlin and, indeed, how the cuts in the Royal Navy surface fleet will be viewed by the White House and our allies across the sea. A 3 per cent. increase in real terms is inadequate to the danger of the hour. It is inadequate to sustain even our existing capability. My right hon. Friend rightly did not conceal from the House the gravity of the Soviet threat as he sees it today.
When my right hon. Friend and his colleagues in the Government argue that resources are not available, I must question whether that is really so. Did my right hon. Friend not hear the Prime Minister declare only this afternoon at Question Time that no less than £1,000 million per year is currently being spent to finance job support and job creation schemes and that a further £3,000 million per year is being devoted to the support of the nationalised industries? A great deal of defence could be purchased with that £4,000 million. How can my right hon. Friend defend such squandering of public expenditure at a time when the threat to peace is as great as it has ever been in the post-war years and when 2½ million of our fellow citizens are unemployed? To cut orders to British Aerospace, Rolls-Royce, British Shipbuilders, British Leyland and electronics and engineering firms at this time does not square with the Government's responsibilities.
In conclusion, I urge my right hon. Friends to abandon the Socialist soup-kitchen mentality of handouts to the nationalised industries and make-work schemes in favour of a defence-led way out of the recession. That will create real jobs and provide real security at a time when the threat to peace and freedom has never been greater in our lifetime.

Mr. Stephen Ross: I shall try to be brief. I begin by stating simply that I am greatly in favour of the conventional Navy and totally opposed to Trident. Whatever the Secretary of State may say, I believe that it is our commitment to the independent nuclear deterrent which is already casting its shadow over our whole defence programme. Can he tell us whether the cost of Trident is still on the Navy's budget or whether it has now been merged in the general defence budget? I believe that it is still listed as a Navy responsibility. I am sure that that, too, has had an effect.
Why are we not rationalising the use of our defence resources within the Atlantic Alliance instead of stupidly maintaining the pretence that we must have at least one weapon system over which we have the ultimate power of decision? I believe that that is a leftover from delusions of super-power status which takes Britain back into the nuclear arms race.
We must heed the warning of the right hon. Member for Sidcup (Mr. Heath). Increasing numbers of people in this country are becoming extremely worried at the buildup of the nuclear arms programme and it is becoming increasingly difficult to defend even the updating of our nuclear weapons within NATO, which I entirely support. I support the introduction of the cruise missile system, but it is becoming harder and harder to put that over to the general public. We must take that into account.
It is of paramount importance that the NATO countries should now undertake a major re-examination of the functions of the Alliance and how they may best be shared out. Without such a multilateral approach, unilateral actions will be taken leading to weaknesses in the Alliance which, on the face of it, we have already precipitated with the recent defence statement and new defence programme.
If there is one role above all others that Britain is uniquely qualified to perform, it is the maritime defence of the Eastern Atlantic. Without any doubt, at this moment we are the leaders and we are regarded with respect by our allies, particularly the United States. There are close working relationships between the Royal Navy and the


American Navy which do not obtain in the other Services. If these cuts go, through we are likely to surrender that role to the French. I wonder whether we want them to take over our role.
We need to concentrate on cheaper, more versatile ships. However, we should not scrap what we have got, which on the whole is of high quality. Most hon. Members will have the brief of the Greenwich Forum, which should be studied with care. It states:
What the United Kingdom does in the Eastern Atlantic is unique and should not be cut back. It is inconceivable that other European countries would not make good deficiencies in BOAR quite easily. The political arguments are contrary to this view but any serious reduction in our maritime capabilities would be most difficult to restore.
Have we studied all the alternatives?
Some of my suggestions may be cheeky, but I shall put them. Do we need five defence Ministers and their backup staff, because that costs money? I understand that the Royal Air Force is increasing its central defence staff. Is that true? We have too many chiefs and too few indians.
The role of Bath and British Shipbuilders and the link between them has been queried. Are we happy that they are working as effectively as possible? I do not think that they are. Does the Royal Air Force need 54 airfields for its 540 aircraft? The Royal Navy makes do with three airfields for its 230 aircraft. The subject of BAOR's support staff has been raised. Further cuts could be made.
Such questions deserve better answers than those that have been given. Ultimately, it is the threat from enemy submarines and mines to which we need to give our greatest attention. We should not place so much reliance on the Nimrods, which are extremely expensive, and on a limited hunter-killer submarine force, which will not be increased at anything like the necessary speed.
From a constituency angle, the likely defence cuts are viewed with despair because many of my constituents cross the Solent to shipyards and dockyards and to the defence industries surrounding Portsmouth and Southampton. If we felt that the revised programme was soundly based and that the Government were making real efforts to soften the blow for those who are about to lose jobs, we might be prepared to bear it. However, little has been said about that. Much greater compassion in these matters is desperately needed. Neither description applies, and that is why my colleagues and I will vote against the Government.

Mr. Bruce George: On a point of order, Mr. Deputy Speaker. I apologise for raising a point of order, particularly today, but like many hon. Members I have sat in the Chamber all day. I am not a Front Bench spokesman, a Privy Councillor or a former defence Minister. I have not got a dockyard in my constituency that is about to be closed. What chance do I have of being called and what chance do many Conservative Members have of being called? Is there any possibility, Mr. Deputy Speaker, that in the same way as Departments transfer questions you can transfer speakers to Thursday's debate, when there will be a crying need for them?

Mr. Deputy Speaker: The hon. Gentleman knows that that is not a matter for me. However, 21 other hon. Members are as disappointed as the hon. Gentleman. The fault lies with over-long speeches. Perhaps the Procedure Committee will look again at limiting the length of speeches.

Mr. Arthur Davidson: When he opened the debate, the Secretary of State pondered why the Campaign for Nuclear Disarmament and its supporters were gaining ground. He seemed worried about that. Indeed, he must have been worried to have begun his speech with such postulations. Having listened to the debate, I can give the right hon. Gentleman one reason for its success. I am not being critical of any hon. Member when I say that the language that defence experts use bears no relation to what ordinary people think and understand. That is a fact of life.
I am no expert, but I have heard phrases today that I had never heard until a few weeks ago. I have heard phrases such as flexible response, nuclear thresholds, GLCMs, LAWs, TOWs, Rapier missile systems, VSTOLs, AV8Bs, MPAs, Sub-Harpoons, Hawks—armed and unarmed—Tornado F-2s, SSNs, MPAs, Sea Kings, Sea Eagles, Sting Rays and so on.
It is right that they should all be mentioned, if only in passing, but people cannot understand how weapons such as those can cost such vast sums of money while at the same time hospitals, school buildings, the school meals service and meals on wheels—all the things that they regard as necessary—are being cut. Until people understand, the Secretary of State has a difficult job to do.
I do not intend to compound the damage by indulging in the technicalities, even if I were capable of doing so. One item that has dominated the debate has been Trident. The press has called it "untouchable". It has been called a "sacred cow" and "inviolable", but in the White Paper it is virtually unmentioned. In a White Paper of about 48 paragraphs it is mentioned only once. The Secretary of State mentioned it on two or three occasions at the end of his speech. I suspect that he mentioned it only once or twice because he knows that he has not provided the House with its true cost or its true effect on our defence spending and the cuts that he has announced.
Trident is a massively important project. It is supposed to cost between £5 billion and £6 billion, yet the Secretary of State brushes over it as if it were a matter of indifference.

Mr. Antony Buck: That is ridiculous.

Mr. Davidson: It is not ridiculous. It is true.

Mr. Churchill: Is the hon. and learned Member aware that Tornado costs £10,000 million, which is double the price of the Trident programme? Is he saying that that should not go ahead?

Mr. Davidson: I am well aware of that. I am sorry that I gave way. I do not like to be informed of something that I already know.
In The Sunday Times Hugo Young, a distinguished political commentator, says that it is the Trident system
around which the rest of the defence budget and arguably public spending of many kinds must arrange itself.
The interesting fact about Trident was brought out graphically in the minority report of the Defence Committee. Although the Secretary of State regards it as inviolable and not to be considered as a candidate for a cut, he has not yet decided on the basic missile. I must press him on that. If I have to use elementary technical language, I shall do so. Will it be the basic C4? Will it be a longer range C4? Will it be a D5 with extra warheads?


Those are important questions. Whether it is to be a longer range or souped-up C4 or the more advanced D5, we must build a bigger and more costly submarine. How much more will that cost, or is the Secretary of State disinclined to tell us?
What effect will the building of Trident have on the other nuclear attack submarines and their building programme? My hon. Friend the Member for Pontypridd (Mr. John) dealt with the matter at some length, and other hon. Members mentioned it. The White Paper describes the nuclear attack submarines as our most powerful weapon for maritime war. It appears that at some stage the building of those submarines will be affected. How badly will it be affected?
The excellent minority report mentioned that the building of Trident, with a greater number of deliverable nuclear warheads controlled by this country, is an increase in vertical proliferation. Does the Secretary of State deny that? The International Institute for Strategic Studies, in its evidence, stated:
this kind of vertical proliferation would be hard to square with the stated objectives of successive Governments with regard to non-proliferation and arms control.
Not only will the number of warheads be increased but there will be an MIRV capability as well. That is an important question. [Interruption.] The hon. Member for Stretford (Mr. Churchill) made a braggadocio speech. He has plenty of opportunity to speak. In fact, many of my hon. Friends believe that he speaks too often.
If the Government acquire the D5 with the extra warheads, does it not advance our nuclear deterrent to a primary, not a second, strike force? The Minister will correct me if I am wrong, but, as I understand the evidence and the Select Committee report, the Trident mark 2 missile would be capable of attacking silos, which, if we acquired it, would change our posture from one of deterrence to one of primary attack. It is a matter of tremendous importance, which the House should debate properly.

Mr. Cormack: The plans and proposals of the Opposition are of as much interest to the country as what the Government are doing. The Opposition have been asked many important questions, notably by the right hon. Member for Plymouth, Devonport (Dr. Owen). Precisely what defence expenditure are the Opposition prepared to sanction? What are their priorities, and what are their views on the NATO nuclear deterrent?

Mr. Davidson: I was under the impression that we were discussing the Government's White Paper, by which the Government must stand or fall. Many Conservative Members are not pleased with it and will, I understand, join us in the Lobby tonight.
The other subject that it is right to discuss in relation to the White Paper is unemployment. I shudder to think of the invective that would be coming from the Conservative Benches, especially from the hon. Member for Stretford, if a Labour Government had introduced a White Paper cutting Royal Navy manpower by 8,000 to 10,000, Army manpower by 7,000 and RAF manpower by 2,500.
If a Labour Government were closing Chatham dockyard, with a loss of 7,000 to 9,000 jobs, and cutting 6,000 jobs in the Portsmouth dockyard, 1,300 in Gibraltar

and 400 at naval headquarters in Bath—including, I hope, some of the Secretary of State's advisers—and implementing civilian redundancies of 20,000 and job losses in the naval depots at Deptford, Invergordon, Llangennech and Pembroke Dock, imagine the words that would be spilling from the mouth of the hon. Member for Stretford. He had the effrontery to refer to "singing the Kremlin's song". That is the base from which he would be attacking us if we had introduced this appalling White Paper with the appalling job losses that will follow from it.

Mr. Churchill: Read my amendment.

Mr. Davidson: I have read it and I was not impressed. If we had wreaked havoc on a town like Chatham, I shudder to think what invective would have been unleashed against us. The hon. Member for Rochester and Chatham (Mrs. Fenner) graphically illustrated the effects of the Government's proposals. The present unemployment rate of 15 per cent. in Chatham will rise to 25 per cent. and possibly to 33 per cent. if one counts indirect unemployment.
What would have been the reaction of Conservative Members if a Labour Government had done to Portsmouth even a fraction of the damage that the Government are doing? The situation was graphically and courageously described by the hon. Member for Portsmouth, North (Mr. Griffiths), who told us that during the election campaign he said that new jobs would be created by a Conservative Government. He genuinely believed that that would happen. I shudder to think what would have happened if a Labour Government had done such damage to the Portsmouth dockyard.

Sir Frederick Burden: Will the hon. and learned Gentleman undertake that a future Labour Government will reopen the Chatham and Portsmouth dockyards?

Mr. Davidson: The hon. Member for Portsmouth, North said that he was told that it would be impossible to reopen the Chatham dockyard. I do not shrink from telling the hon. Member for Gillingham (Sir F. Burden) what a Labour Government would do. We would expand the economy and tackle unemployment—something which Conservative Members seem to find a cause for amusement.

Mr. Cormack: How would Labour do it?

Mr. Davidson: This is not an economic debate. Mr. Cormack: Let us into the secret.

Mr. Davidson: The hon. Member for Staffordshire, South-West (Mr. Cormack) has asked what we would do. I am about to tell him. Perhaps he will do me the courtesy of listening. We would expand the economy, and we hope that any slack taken up in defence could be used for other, more productive industries.
The right hon. Member for Sidcup (Mr. Heath) made a most interesting, excellent speech, which held the attention of the whole House. He was right to draw attention to the need to reopen disarmament talks. That matter is missing from the White Paper, and no Conservative Member referred to it. Unless we can show that the country is passionately and dedicatedly concerned about arms control at all levels, we shall never win the hearts and minds—to use a cliché—of people who feel a deep sense of revulsion over the possibilities of nuclear


war. The right hon. Gentleman, with all his experience as an ex-Prime Minister, was right to draw our attention to the matter.
What is the Secretary of State's response to Willy Brandt's initiative, Mr. Brandt's meeting with Mr. Brezhnev and his attempts to initiate new arms talks aimed at curbing medium-range nuclear weapons? I wish that the hon. Member for Stretford would not smile when I mention Willy Brandt. If the hon. Gentleman had done half as much for Europe and Europe's security as Willy Brandt has done, he would have some right to snigger as he does.
What have the Government done to back up Mr. Schmidt's initiative? I suspect that they have done little. They have paid lip service to it, but they have not shown a passionate desire to reduce armaments. They have spoken in militaristic terms of the Soviet threat, which I do not underestimate.

Mr. Buck: rose—

Mr. Davidson: The White Paper has been assailed everywhere—by the Secretary of State's hon. Friends, the Opposition, the newspapers, the dockyard workers and even the right hon. Member for Plymouth, Devonport (Dr. Owen) on behalf of the Social Democratic Party. If the right hon. Gentleman is voting for his own amendment, he might at least vote against the White Paper as well. That would express proper opposition to a White Paper that creates massive unemployment, severely restricts our maritime presence and speaks of a fifth presence when for our forces we cannot support even four presences. The White Paper is a sham and it deserves to be voted against.

The Minister of State for the Armed Forces (Mr. Peter Blaker): I start by restating the reasons for this review and the way in which it was conducted. It was necessary, first, because over the last few months it had become increasingly evident that our existing plans were too ambitious and too optimistic, measured against the amount of money that the Government could reasonably plan to spend on defence. The real costs of defence equipment had been rocketing. In the early 1960s a Leander class frigate cost about £5 million. Her replacement in 1978 cost three times as much in real terms.
Against that background of rising real costs of defence equipment we were trying to do too much across the whole spectrum of defence activities, and the inevitable result would have been to achieve too little. The short-term results were shown last year when we had to take many painful measures to hold back spending. As well as imposing a moratorium on new purchases from industry, we had to cut back levels of activity in the Services. We had to cut back on flying hours, on fuel for the fleet, on fuel for Army training and on ammunition. We had to cut back on the supply of spares.
One cannot do that for long without serious effects on the standards of training of the Services and morale. Once training standards have fallen, they are not easy to restore. The more complex equipment becomes, the more important training is.
The second reason for the review was that we were conscious of the fact that there had been no fundamental appraisal of the role, structure and balance of our forces for many years, but technological change has been rapid.

Modern weapons, if their crews are properly trained, can hit their tagets at longer ranges harder and more reliably than the weapons of the 1960s. We believe that we must change the balance of investment between such weapons and costly and increasingly vulnerable major platforms, including surface ships. We believe also that it is important to pay more attention to less glamorous things such as war stocks. We want to make a major assault on overhead and support costs. Most of the changes will take some years to work through, but I am certain that they will leave our forces as a whole better balanced, more self-confident and making a more cost-effective contribution to the security of NATO.
As my right hon. Friend explained, the review was not done on the basis of equal shares for each Service. Still less was it done by saying that the Trident programme should be counted against the Navy's share. It was done by considering from the ground, or should I say from the sea, up, what was the best programme for our country's defence as a whole. The result is that all three Services will have fewer men. The Army will lose 7,000 or thereabouts. The Royal Navy—it has been much discussed—will have fewer surface ships and the balance of our maritime and maritime-air role will shift more in the direction of submarines and air systems.
As my right hon. Friend has pointed out, the procurement Vote for maritime systems for the next four years will still show an increase, though the provision for the dockyards will decline by 25 to 30 per cent. over the same period instead of increasing as had been previously planned.
I wish to deal with as many as possible of the points that have been raised in the debate. I must say a word, however, about the attitude of the Opposition. The hon. Member for Pontypridd (Mr. John), who opened the debate for the Opposition, made not one proposal in his whole speech. I understand the difficulty of his position, to which attention was drawn by the right hon. Member for Plymouth, Devonport (Dr. Owen). The fact is that the Opposition have no defence policy and many defence policies—as many defence policies as there are members of the Opposition.

Mr. John: Since there are three amendments in the name of the Conservative Party, perhaps the hon. Gentleman will say which of those represents party policy.

Mr. Blaker: The policies of the Opposition, if I can call them that, have two things in common—incoherence and a determination to ignore the nature and size of the threat. It is significant that of the defectors to the Social Democrats, four were official Front Bench spokesmen on defence for the Labour Party.
The amendment in the name of most of the Shadow Cabinet in the defence debate in May—this is the most recent statement of its policy that is available—called for a reduction in our defence expenditure to the same proportion of gross domestic product as that of our major European allies. It conveniently omitted from the calculation the proportion spent by the United States and the Soviet Union—between 12 and 14 per cent.
I asked officials in the Ministry of Defence to give me some examples of what such a reduction would mean to the United Kingdom defence programme. It would correspond to 80 per cent. of the total equipment budget for this year, or to three times the cost of the BAOR. If


Opposition Members think that a coherent defence policy was embodied in that amendment, they had better think again.

Mr. John: We have not tabled an amendment. We are voting against the shambles of a White Paper produced by the Secretary of State. If the right hon. Gentleman is so good at costing items, why has he refused to put any costing in his White Paper?

Mr. Blaker: Perhaps the hon. Gentleman was not listening. I was referring to the amendment that the Opposition tabled in May. Perhaps he prefers to forget that amendment.

Mr. Peter Snape: This is July.

Mr. Blaker: There has been a great deal of discussion about Trident. The Opposition amendment in May called on the Government to cancel that programme. The amendment was supported by many Opposition Members, who were members of the Government who continued the Polaris and Chevaline programmes. There has been a substantial change in the position of some Opposition Members.

Dr. Owen: There is no connection between the continuation of a Polaris missile system and its modernisation and the decision to adopt a second generation system. The Minister knows that as Foreign Secretary I constantly opposed any decision to adopt the Trident system. My position has been consistent both in and out of Government.

Mr. Blaker: If the right hon. Gentleman has been consistent, that is more than can be said for his former colleagues.

Mr. Snape: Name one.

Mr. Blaker: The right hon. Member for Ebbw Vale (Mr. Foot). The review was not the result of a decision to adopt Trident. That programme will cost only £200 million to £300 million a year during the next few years out of a total budget which this year is £12,500 million. Our cost-control problems are occurring now.
The review considered Trident and concluded that it was by far the best way to continue our independent strategic nuclear deterrent—for reasons of cost, continuing invulnerability, and therefore of effectiveness in deterring any potential aggressor. As my right hon. Friend said, the cost will represent only 3 per cent., on average, of the defence budget during the 15-year period in which it is introduced. When it is fully in service that will drop to 1½ per cent.
I must comment on the demand by Opposition Members for one-sided nuclear disarmament by the United Kingdom. The argument is that the United Kingdom would cease to be a target in war if it adopted that course. There is no way that we can avoid being a target in war. Our location, industrial strength and political importance would mean that if war broke out we could not escape attack. That is why we put the emphasis on preventing war. If we alone disarm, we reduce the incentive for the Soviet Union to disarm. One-sided disarmament is the enemy of multilateral disarmament. It is a step not towards it but away from it. The two cannot live together.
The search for arms control and disarmament on a multilateral basis has been a bipartisan matter for as long

as I can remember. The subject has been mentioned by many hon. Members during the debate and I make no apology for referring to it now. I have a list of the principal agreements that have been concluded on arms control and disarmament since 1945. Six have been concluded under Labour Governments and seven under Conservative Governments.
The Conservative agreements include the biological weapons convention of 1972, which is the one real disarmament agreement among all the others in the list. Most recent are the convention banning the use of certain inhumane weapons, which was concluded a few months ago on the basis of a joint draft put forward by the British Government and the Government of the Netherlands, and the partial nuclear test ban treaty of 1973, to which my right hon. Friend the Member for Sidcup (Mr. Heath) referred. There is no difference between the parties about the importance of arms control and disarmament.
The right hon. Member for Devonport talked about retaining Polaris. We considered that option. The first objection to it is that we would need new boats in the 1990s. As my right hon. Friend the Secretary of State has said, boats are much the most important part of any strategic nuclear submarine system. The missiles themselves are also ageing. They will leave United States service this year. Although some stocks of supplies will be available, the closure of United States production and support facilities will make it more and more difficult and costly to maintain the missiles in operational condition beyond the early 1990s.
To fit the missiles into new submarines would need costly new fire control and launcher sub-systems. Although there would be some short-term saving in capital expenditure, the missiles would still have to be replaced after a few years. That would involve difficult, protracted and costly modifications to the submarines in addition to the cost of the new missile system. There would not be significant savings in costs.
The right hon. Gentleman referred to the possibility of putting cruise missiles into existing SSNs. That is theoretically possible, but to load and launch the necessary number of missiles through torpedo tubes, which I imagine is what he has in mind, would take several hours and would involve the considerable risk that the submarines would be detected and destroyed after only a few missiles had been launched. The existing fleet of hunter-killer submarines would provide nothing like the number of launching platforms required to give a reasonable certainty of inflicting the required level of damage. We would have to build many more boats, and that brings me back to costs. To use the boats for such a purpose would seriously reduce their availability for their main role.

Mr. Onslow: Is it not also true that if this expedient were ever to be adopted, it would involve a forfeit in terms of launching which would make it impossible to maintain that we had a credible strategic deterrent? The submarines using cruise missiles would have to stand so close in to Soviet waters that they would become extremely vulnerable.

Mr. Blaker: My hon. Friend is right. This point was well brought out in the recent report from the Select Committee of which he is Chairman. I shall not give way again because many matters remain with which I want to deal.
My right hon. Friend the Member for Brighton, Pavilion (Mr. Amery) and my hon. Friend the Member for Stretford (Mr. Churchill) suggested that we were not spending enough on defence. I understand the basic argument that they are advancing. We are spending 5·2 per cent. of our gross domestic product. It is impossible to say whether our GDP will increase, because we cannot forecast the growth of our domestic product. However, by 1985–86 we shall be spending 21 per cent. more in real terms on defence than in 1978–79.

Mr. Amery: rose—

Mr. Blaker: No, I will not give way.
I want to refer to the dockyards, because a number of hon. Members have spoken with great feeling about their constituencies. I think particularly of my hon. Friends the Members for Portsmouth, North (Mr. Griffiths), for Portsmouth, South (Mr. Pink) and for Rochester and Chatham (Mrs. Fenner).

Mr. Amery: rose—

Hon. Members: Give way.

Mr. Blaker: The subject was also referred to by the hon. Member for Southampton, Itchen (Mr. Mitchell). I pay tribute to the work that they have done on behalf of their constituents, to the representations that they have made to the Government and to the vigour with which they have pursued the resolution of the problems which their constituents will face. I also pay a tribute to the dockyards that are affected. The decisions on Chatham and Portsmouth in no way reflect on the distinguished history of those yards.

Mr. Peter Viggers: rose—

Mr. Blaker: I shall give way to my hon. Friend.

Mr. Viggers: I am grateful to my hon. Friend. I have been sitting here for five and three-quarter hours and have not bothered the House before. Does my hon. Friend accept that the dockyard closures are in areas of such concentrated defence effort that they have more in common with steel closures than anything else? Will compensation and redundancy be gauged accordingly?

Mr. Blaker: I accept that they are concentrated in an unusual way, and I should like to say what we are doing by way of consultation.
I was asked why Chatham and Portsmouth had been chosen. This was a process of elimination—[Interruption.] I hope that Opposition Members will treat this subject seriously. It is a serious subject for my hon. Friends and for at least one Opposition Member, and I think that the House would like to hear what I have to say.
Devonport is the largest and most diversified of the yards. It has a modern capacity to service the nuclear fleet submarines. It also has a naval base. We therefore had to retain Devonport. Rosyth is vital as an operational base facing the North Sea—

Mrs. Fenner: I do not know how my hon. Friend can say that. I have just learned from the local press that the failure of the "Swiftsure" was due to the fact that it was dropped by a crane, which makes it several inches out of true. I should still like to know how much this will cost.

Mr. Blaker: I shall have to look into that matter. Rosyth is vital as an operational base facing the North Sea, and it refits the Polaris submarine. That left Portsmouth and Chatham. Chatham has declined in importance as a

naval base, and little remains there except the dockyard. Portsmouth has no capacity for servicing nuclear submarines. These considerations pointed to Chatham as the yard that had to be closed and to the rest of the required reduction being made at Portsmouth.

Mr. Amery: rose—

Hon. Members: Give way.

Mr. Speaker: Order. It is clear that the Minister is not giving way to the right hon. Gentleman, and therefore the debate must continue.

Mr. Blaker: The Government deeply regret the loss of jobs that is entailed. My right hon. Friend and I have already had discussions with hon. Members, the local authorities and the trade unions concerned. Consultations will continue and every effort will be made to minimise hardship. [HON. MEMBERS: "How?"] I understand that the local authorities in Hampshire intend to set up a special working group to consider the problems that will arise in Portsmouth and the surrounding areas. The Ministry of Defence will be represented on that working group, as will other Government Departments as well as the local authorities. We should, of course, be prepared to co-operate in similar arrangements for Chatham.

Mr. Moate: Will my hon. Friend give way?

Mr. Blaker: I had better not give way.
My hon. Friend the Member for Portsmouth, North asked whether ship visits to Portsmouth would continue following the planned rundown in the dockyard there. The naval base at Portsmouth will continue as at present. There will be no reduction in the facilities available for visiting ships and I therefore see no reason why ship visits should not continue to be a regular feature.
My hon. Friend the Member for Rochester and Chatham asked a number of questions at great speed. I shall study them tomorrow in Hansard. I invite her to come and talk to me about them. We intend that the refitting of the two SSNs which are now in Chatham will be concluded there.
I was asked by the hon. Member for Pontypridd about apprenticeships. In both dockyards we hope to allow apprentices already there to complete their time, certainly until 1982 and 1983. With regard to the Portsmouth apprentice training school, as we run down the numbers at Portsmouth in line with the rundown of numbers of staff generally, we shall increasingly have facilities at the school for others to use. Hon. Members in the area and the city council are anxious to keep open the school with its splendid new facilities. We share that wish.
I was asked by my right hon. Friend the Member for Taunton (Mr. du Cann) about hydrographic surveillance. We are looking at the size and shape of the surveying flotilla in the light of the decisions which we have announced on the composition and size of the future fleet with the object of matching the resources available to the future task. I assure my right hon. Friend that I am aware of the importance of the civil requirement. I shall discuss with my right hon. Friend the Secretary of State for Trade how that requirement can continue to be met.
The hon. Member for Pontypridd asked about SSN numbers. My right hon. Friend the Secretary of State talked about the number of SSNs in service in 1990, which was 17. He did not comment on the number of new orders


between now and then, but the number of new SSN orders in the next few years will depend on our resources. The number is likely to go above 17.
I have been asked by several hon. Members, including the hon. Member for Pontypridd, about warship building. My right hon. Friend has made clear the importance that we attach to the construction of new warships in British yards. We are currently building 20 ships. We shall be looking at new ships such as the type 23. We have already said that it will be our aim to get orders for those into the shipbuilding yards as quickly as possible. We shall listen to any suggestion made by British industry to that end. This is an important point. In addition, we must improve our performance in the export market.
I wish to make a point about the Territorial Army, which relates to a question put by my right hon. Friend the Member for Sidcup. He rightly said how important it is that the Territorial Army should be properly equipped. We entirely agree with him. Among the up-to-date weapons recently issued are the 105mm light gun and the Blowpipe air defence missile. Territorial Army units for BAOR are being equipped with the Clansman radio system at the moment. All the TA infantry battalions with a role in BAOR will be issued with the Milan anti-tank guided weapon starting this year. That equipment represents enormous enhancements in the capability of the Territorial Army and will make new demands on our volunteers, which I am sure they will meet admirably.

Mr. John: Will the Minister confirm that the diesel submarine—the SSK—will not be ordered until 1983? Will he say anything about the placing of orders with the shipyards for the boats announced when the right hon. Gentleman made his statement? If he does not, redundancies will surely follow.

Mr. Blaker: We shall place the order as soon as we can, probably in 1983.
I shall summarise the result of the review.

Mr. Churchill: Will my hon. Friend give way?

Mr. Blaker: There is not time to give way.

Mr. Churchill: Give way.

Mr. Speaker: Order. The Minister has made it clear that he does not wish to give way in the minutes that remain.

Mr. Blaker: To sum up, we are not cutting our defence programme. We are changing the balance within an enlarged programme to provide harder hitting, better trained forces with more staying power. We plan a 3 per cent. increase in defence spending in real terms for four years ahead. I believe that to be without precedent.
We are strengthening the defence of the United Kingdom base. I am glad that the right hon. Member for Down, South (Mr. Powell) drew attention to the importance of that. We are doing this with more modern aircraft, by increasing substantially the number of aircraft with a home defence role, by supporting our fighter force with a fleet of air tankers, by building new mine hunters, by improving our methods of defensive mine laying, by increasing the Territorial Army and its number of training days and by enhancing the role of the Royal Navy Reserve and the Royal Auxiliary Air Force.
At sea we shall retain a major role in the North-East Atlantic and in the Greenland-Iceland-United Kingdom gap. The balance of the weapons with which we perform that role will change. We shall have a somewhat smaller surface fleet, but each vessel will spend more of its life available for operations. We intend to bring in a new, cheaper and less sophisticated line of escort vessels, which we hope will be attractive to other countries as well as to the Royal Navy.
We shall continue to increase the number of our nuclear-powered hunter-killer submarines, and we shall bring in a new class of more effective and quieter diesel-powered submarines. We shall acquire a new heavyweight torpedo. We shall increase the number of Nimrod maritime patrol aircraft, which, like the Sea King and the Lynx helicopters, will use the British Sting Ray torpedo.
We shall provide, for attack against surface ships, a new air-launched guided missile. We envisage that that will be the Sea Eagle, carried by Buccaneer and Sea Harrier aircraft. The enhanced air tanker fleet will increase our maritime air attack capability. We shall retain the three Royal Marine Commandos and develop our ability to act with ships, aircraft and troops outside the NATO areas. On the Continent we shall maintain the numbers to which we are committed by the Brussels Treaty, but with more modern equipment and greater hitting and staying power.
We plan the new Challenger tank for four regiments, new artillery, improved anti-tank weapons, improved night sights for missiles and tanks and the Wavell system for rapid handling of information. That system has great potential for sales overseas.
We plan to buy 60 AV8B Harrier aircraft under an agreement with the American Government, which will bring much business to British industry. We shall introduce a second squadron of the big Chinook helicopters and the tracked version of the Rapier missile system.
We shall continue with the deployment of the Tornado strike attack and air defence versions and introduce a weapons system for cratering enemy airfields. Not least, we shall be able, as a result of the review, to improve the effectiveness and staying power of all our forces, by increasing their activity levels, their war stocks and ammunition—thus raising the nuclear threshold. It is untrue to suggest, as the hon. Member for Sheffield Attercliffe (Mr. Duffy) and others did, that we are lowering the nuclear threshold. We are raising it, not least by increasing stocks and ammunition.
A distinguished British admiral, quoted recently with the approval of my hon. Friend the Member for Woking (Mr. Onslow), said two years ago that deterrence at the highest level rests on the twin pillars of capability and credibility. The programme which the Government are presenting to the House this evening will enhance the ability of the Armed Forces—

Mr. John Roper: rose in his place and claimed to move, That the Question be now put.

Question, That the Question be now put, put and agreed to.

Question put accordingly, That the amendment be made:—

The House divided: Ayes 17, Noes 320.

Division No. 254]
[10 pm


AYES


Alton, David
Brocklebank-Fowler, C.


Beith, A. J.
Ellis, Tom (Wrexham)






Freud, Clement
Steel, Rt Hon David


Howells, Geraint
Thomas, Mike (Newcastle E)


Kilfedder, James A.
Wainwright, R. (Colne V)


Mabon, Rt Hon Dr J. Dickson
Wrigglesworth, Ian


Maclennan, Robert



Owen, Rt Hon Dr David



Penhaligon, David
Tellers for the Ayes:


Ross, Stephen (Isle of Wight)
Mr. James Wellbeloved and


Sandelson, Neville
Mr. John Roper.




NOES


Adley, Robert
Dorrell, Stephen


Aitken, Jonathan
Douglas-Hamilton, Lord J.


Alexander, Richard
Dover, Denshore


Amery, Rt Hon Julian
du Cann, Rt Hon Edward


Ancram, Michael
Dunlop, John


Arnold, Tom
Dunn, Robert (Dartford)


Aspinwall, Jack
Durant, Tony


Atkins, Rt Hon H. (S'thorne)
Dykes, Hugh


Atkins, Robert (Preston N)
Eden, Rt Hon Sir John


Atkinson, David (B'm'th,E)
Edwards, Rt Hon N. (P'broke)


Baker, Kenneth (St.M'bone)
Eggar, Tim


Baker, Nicholas (N Dorset)
Elliott, Sir William


Banks, Robert
Emery, Peter


Beaumont-Dark, Anthony
Eyre, Reginald


Bendall, Vivian
Fairbairn, Nicholas


Bennett, Sir Frederic (T'bay)
Fairgrieve, Russell


Benyon, Thomas (A'don)
Faith, Mrs Sheila


Benyon, W. (Buckingham)
Farr, John


Best, Keith
Fell, Anthony


Bevan, David Gilroy
Fenner, Mrs Peggy


Biffen, Rt Hon John
Finsberg, Geoffrey


Biggs-Davison, John
Fisher, Sir Nigel


Blackburn, John
Fletcher, A. (Ed'nb'gh N)


Blaker, Peter
Fletcher-Cooke, Sir Charles


Body, Richard
Fookes, Miss Janet


Bonsor, Sir Nicholas
Forman, Nigel


Boscawen, Hon Robert
Fowler, Rt Hon Norman


Bottomley, Peter (W'wich W)
Fox, Marcus


Bowden, Andrew
Fraser, Rt Hon Sir Hugh


Boyson, Dr Rhodes
Fraser, Peter (South Angus)


Bradford, Rev R.
Fry, Peter


Braine, Sir Bernard
Galbraith, Hon T. G. D.


Bright, Graham
Gardiner, George (Reigate)


Brinton, Tim
Gardner, Edward (S Fylde)


Brittan, Leon
Garel-Jones, Tristan


Brooke, Hon Peter
Gilmour, Rt Hon Sir Ian


Brotherton, Michael
Glyn, Dr Alan


Brown, Michael (Brigg &amp; Sc'n)
Goodhart, Philip


Browne, John (Winchester)
Goodhew, Victor


Bruce-Gardyne, John
Goodlad, Alastair


Bryan, Sir Paul
Gorst, John


Buchanan-Smith, Alick
Gow, Ian


Buck, Antony
Gower, Sir Raymond


Budgen, Nick
Grant, Anthony (Harrow C)


Bulmer, Esmond
Gray, Hamish


Burden, Sir Frederick
Greenway, Harry


Butcher, John
Grieve, Percy


Cadbury, Jocelyn
Griffiths, E. (B'y St. Edm'ds)


Carlisle, John (Luton West)
Griffiths, Peter Portsm'th N)


Carlisle, Kenneth (Lincoln)
Grist, Ian


Carlisle, Rt Hon M. (R'c'n )
Grylls, Michael


Chalker, Mrs. Lynda
Gummer, John Selwyn


Channon, Rt. Hon. Paul
Hamilton, Hon A.


Churchill, W. S.
Hamilton, Michael (Salisbury)


Clark, Hon A. (Plym'th, S'n)
Hampson, Dr Keith


Clark, Sir W. (Croydon S)
Hannam, John


Clarke, Kenneth (Rushcliffe)
Haselhurst, Alan


Clegg, Sir Walter
Hastings, Stephen


Cockeram, Eric
Havers, Rt Hon Sir Michael


Colvin, Michael
Hawkins, Paul


Cope, John
Hawksley, Warren


Cormack, Patrick
Hayhoe, Barney


Corrie, John
Heath, Rt Hon Edward


Costain, Sir Albert
Heddle, John


Cranborne, Viscount
Henderson, Barry


Critchley, Julian
Heseltine, Rt Hon Michael


Crouch, David
Hicks, Robert


Dean, Paul (North Somerset)
Higgins, Rt Hon Terence L.


Dickens, Geoffrey
Hill, James





Hogg, Hon Douglas (Gr'th'm)
Nott, Rt Hon John


Holland, Philip (Carlton)
Onslow, Cranley


Hooson, Tom
Oppenheim, Rt Hon Mrs S.


Hordern, Peter
Osborn, John


Howe, Rt Hon Sir Geoffrey
Page, John (Harrow, West)


Howell, Rt Hon D. (G'ldf'd)
Page, Rt Hon Sir G. (Crosby)


Howell, Ralph (N Norfolk)
Page, Richard (SW Herts)


Hunt, David (Wirral)
Parris, Matthew


Hunt, John (Ravensbourne)
Patten, Christopher (Bath)


Irving, Charles (Cheltenham)
Patten, John (Oxford)


Jenkin, Rt Hon Patrick
Pattie, Geoffrey


Jessel, Toby
Pawsey, James


Johnson Smith, Geoffrey
Percival, Sir Ian


Jopling, Rt Hon Michael
Peyton, Rt Hon John


Joseph, Rt Hon Sir Keith
Pink, R. Bonner


Kaberry, Sir Donald
Pollock, Alexander


Kellett-Bowman, Mrs Elaine
Porter, Barry


Kershaw, Anthony
Powell, Rt Hon J.E. (S Down)


Kimball, Marcus
Prentice, Rt Hon Reg


King, Rt Hon Tom
Price, Sir David (Eastleigh)


Kitson, Sir Timothy
Prior, Rt Hon James


Knight, Mrs Jill
Proctor, K. Harvey


Knox, David
Pym, Rt Hon Francis


Lamont, Norman
Raison, Timothy


Lang, Ian
Rathbone, Tim


Langford-Holt, Sir John
Rees, Peter (Dover and Deal)


Latham, Michael
Rees-Davies, W. R.


Lawrence, Ivan
Renton, Tim


Lawson, Rt Hon Nigel
Rhodes James, Robert


Lee, John
Rhys Williams, Sir Brandon


Lennox-Boyd, Hon Mark
Ridsdale, Sir Julian


Lester, Jim (Beeston)
Rifkind, Malcolm


Lewis, Kenneth (Rutland)
Rippon, Rt Hon Geoffrey


Lloyd, Ian (Havant &amp; W'loo)
Roberts, M. (Cardiff NW)


Lloyd, Peter (Fareham)
Roberts, Wyn (Conway)


Loveridge, John
Rossi, Hugh


Luce, Richard
Rost, Peter


Lyell, Nicholas
Royle, Sir Anthony


McCrindle, Robert
Sainsbury, Hon Timothy


Macfarlane, Neil
St. John-Stevas, Rt Hon N.


MacGregor, John
Scott, Nicholas


MacKay, John (Argyll)
Shaw, Giles (Pudsey)


Macmillan, Rt Hon M.
Shaw, Michael (Scarborough)


McNair-Wilson, M. (N'bury)
Shelton, William (Streatham)


McNair-Wilson, P. (New F'st)
Shepherd, Colin (Hereford)


McQuarrie, Albert
Shepherd, Richard


Madel, David
Shersby, Michael


Major, John
Silvester, Fred


Marland, Paul
Sims, Roger


Marlow, Tony
Skeet, T. H. H.


Marshall, Michael (Arundel)
Speed, Keith


Marten, Neil (Banbury)
Speller, Tony


Mates, Michael
Spence, John


Mather, Carol
Spicer, Jim (West Dorset)


Maude, Rt Hon Sir Angus
Spicer, Michael (S Worcs)


Mawby, Ray
Sproat, Iain


Mawhinney, Dr Brian
Squire, Robin


Maxwell-Hyslop, Robin
Stainton, Keith


Mayhew, Patrick
Stanbrook, Ivor


Mellor, David
Stanley, John


Meyer, Sir Anthony
Steen, Anthony


Miller, Hal (B'grove)
Stevens, Martin


Mills, Iain (Meriden)
Stewart, Ian (Hitchin)


Mills, Peter (West Devon)
Stewart, A.(E Renfrewshire)


Miscampbell, Norman
Stokes, John


Mitchell, David (Basingstoke)
Stradling Thomas, J.


Moate, Roger
Tapsell, Peter


Molyneaux, James
Taylor, Teddy (S'end E)


Monro, Hector
Tebbit, Norman


Montgomery, Fergus
Temple-Morris, Peter


Morgan, Geraint
Thatcher, Rt Hon Mrs M.


Morris, M. (N'hampton S)
Thomas, Rt Hon Peter


Morrison, Hon C. (Devizes)
Thompson, Donald


Morrison, Hon P. (Chester)
Thorne, Neil (Ilford South)


Murphy, Christopher
Thornton, Malcolm


Myles, David
Townend, John (Bridlington)


Neale, Gerrard
Townsend, Cyril D, (B'heath)


Needham, Richard
Trippier, David


Neubert, Michael
Trotter, Neville


Newton, Tony
van Straubenzee, W. R.






Vaughan, Dr Gerard
Whitelaw, Rt Hon William


Viggers, Peter
Whitney, Raymond


Waddington, David
Wickenden, Keith


Wakeham, John
Wiggin, Jerry


Waldegrave, Hon William
Wilkinson, John


Walker, Rt Hon P. (W'cester)
Williams, D. (Montgomery)


Walters, Dennis
Winterton, Nicholas


Ward, John
Wolfson, Mark


Warren, Kenneth
Young, Sir George (Acton)


Watson, John



Wells, John (Maidstone)
Tellers for the Noes:


Wells, Bowen
Mr. Spencer Le Marchant and


Wheeler, John
Mr. Anthony Berry.

Question accordingly negatived.

Main Question put:—

The House divided: Ayes 309, Noes 240.

Division No. 255]
[10.12 pm


AYES


Adley, Robert
Crouch, David


Aitken, Jonathan
Dean, Paul (North Somerset)


Alexander, Richard
Dickens, Geoffrey


Ancram, Michael
Dorrell, Stephen


Arnold, Tom
Douglas-Hamilton, Lord J.


Aspinwall, Jack
Dover, Denshore


Atkins, Rt Hon H. (S'thorne)
du Cann, Rt Hon Edward


Atkins, Robert (Preston N)
Dunlop, John


Atkinson, David (B'm'th,E)
Dunn, Robert (Dartford)


Baker, Kennelh (St.M'bone)
Durant, Tony


Banks, Robert
Dykes, Hugh


Beaumont-Dark, Anthony
Eden, Rt Hon Sir John


Bendall, Vivian
Edwards, Rt Hon N. (P'broke)


Bennett, Sir Frederic (T'bay)
Eggar, Tim


Benyon, Thomas (A'don)
Elliott, Sir William


Benyon, W. (Buckingham)
Emery, Peter


Best, Keith
Eyre, Reginald


Bevan, David Gilroy
Fairbairn, Nicholas


Biffen, Rt Hon John
Fairgrieve, Russell


Biggs-Davison, John
Faith, Mrs Sheila


Blackburn, John
Farr, John


Blaker, Peter
Fell, Anthony


Body, Richard
Finsberg, Geoffrey


Bonsor, Sir Nicholas
Fisher, Sir Nigel


Boscawen, Hon Robert
Fletcher, A. (Ed'nb'gh N)


Bottomley, Peter (W'wich W)
Fletcher-Cooke, Sir Charles


Bowden, Andrew
Fookes, Miss Janet


Boyson, Dr Rhodes
Forman, Nigel


Bradford, Rev R.
Fowler, Rt Hon Norman


Braine, Sir Bernard
Fox, Marcus


Bright, Graham
Fraser, Rt Hon Sir Hugh


Brittan, Leon
Fraser, Peter (South Angus)


Brooke, Hon Peter
Fry, Peter


Brotherton, Michael
Galbraith, Hon T. G. D.


Brown, Michael (Brigg &amp; Sc'n)
Gardiner, George (Reigate)


Browne, John (Winchester)
Gardner, Edward (S Fylde)


Bruce-Gardyne, John
Garel-Jones, Tristan


Bryan, Sir Paul
Gilmour, Rt Hon Sir Ian


Buchanan-Smith, Alick
Glyn, Dr Alan


Buck, Antony
Goodhart, Philip


Budgen, Nick
Goodhew, Victor


Bulmer, Esmond
Goodlad, Alastair


Butcher, John
Gorst, John


Cadbury, Jocelyn
Gow, Ian


Carlisle, John (Luton West)
Gower, Sir Raymond


Carlisle, Kenneth (Lincoln)
Grant, Anthony (Harrow C)


Carlisle, Rt Hon M. (R'c'n )
Gray, Hamish


Chalker, Mrs. Lynda
Greenway, Harry


Channon, Rt. Hon. Paul
Grieve, Percy


Clark, Hon A. (Plym'th, S'n)
Griffiths, E. (B'ySt. Edm'ds)


Clark, Sir W. (Croydon S)
Grist, Ian


Clarke, Kenneth (Rushcliffe)
Grylls, Michael


Clegg, Sir Walter
Gummer, John Selwyn


Cockeram, Eric
Hamilton, Hon A.


Colvin, Michael
Hamilton, Michael (Salisbury)


Cope, John
Hampson, Dr Keith


Corrie, John
Hannam,John


Costain, Sir Albert
Haselhurst, Alan


Cranborne, Viscount
Hastings, Stephen


Critchley, Julian
Havers, Rt Hon Sir Michael





Hawkins, Paul
Myles, David


Hawksley, Warren
Neale, Gerrard


Hayhoe, Barney
Needham, Richard


Heath, Rt Hon Edward
Neubert, Michael


Heddle, John
Newton, Tony


Henderson, Barry
Nott, Rt Hon John


Heseltine, Rt Hon Michael
Onslow, Cranley


Hicks, Robert
Oppenheim, Rt Hon Mrs S.


Higgins, Rt Hon Terence L.
Osborn, John


Hill, James
Page, John (Harrow, West)


Hogg, Hon Douglas (Gr'th'm)
Page, Rt Hon Sir G. (Crosby)


Holland, Philip (Carlton)
Page, Richard (SW Herts)


Hooson, Tom
Parris, Matthew


Hordern, Peter
Patten, Christopher (Bath)


Howe, Rt Hon Sir Geoffrey
Patten, John (Oxford)


Howell, Rt Hon D. (Gldf'd)
Pattie, Geoffrey


Howell, Ralph (N Norfolk)
Pawsey, James


Hunt, David (Wirral)
Percival, Sir Ian


Hunt, John (Ravensbourne)
Peyton, Rt Hon John


Irving, Charles (Cheltenham)
Pollock, Alexander


Jenkin, Rt Hon Patrick
Porter, Barry


Jessel, Toby
Powell, Rt Hon J.E. (S Down)


Johnson Smith, Geoffrey
Prentice, Rt Hon Reg


Jopling, Rt Hon Michael
Price, Sir David (Eastleigh)


Joseph, Rt Hon Sir Keith
Prior, Rt Hon James


Kaberry, Sir Donald
Proctor, K. Harvey


Kellett-Bowman, Mrs Elaine
Pym, Rt Hon Francis


Kershaw, Anthony
Raison, Timothy


Kimball, Marcus
Rathbone, Tim


King, Rt Hon Tom
Rees, Peter (Dover and Deal)


Kitson, Sir Timothy
Rees-Davies, W. R.


Knight, Mrs Jill
Renton, Tim


Knox, David
Rhodes James, Robert


Lamont, Norman
Rhys Williams, Sir Brandon


Lang, Ian
Ridsdale, Sir Julian


Langford-Holt, Sir John
Rifkind, Malcolm


Latham, Michael
Rippon, Rt Hon Geoffrey


Lawrence, Ivan
Roberts, M. (Cardiff NW)


Lee, John
Roberts, Wyn (Conway)


Lennox-Boyd, Hon Mark
Rossi, Hugh


Lester, Jim (Beeston)
Rost, Peter


Lewis, Kenneth (Rutland)
Royle, Sir Anthony


Lloyd, Ian (Havant &amp; W'loo)
Sainsbury, Hon Timothy


Lloyd, Peter (Fareham)
St. John-Stevas, Rt Hon N.


Loveridge, John
Scott, Nicholas


Luce, Richard
Shaw, Giles (Pudsey)


McCrindle, Robert
Shaw, Michael (Scarborough)


Macfarlane, Neil
Shelton, William (Streatham)


MacGregor, John
Shepherd, Colin (Hereford)


MacKay, John (Argyll)
Shepherd, Richard


Macmillan, Rt Hon M.
Shersby, Michael


McNair-Wilson, M. (N'bury)
Silvester, Fred


McNair-Wilson, P. (New F'st)
Sims, Roger


McQuarrie, Albert
Skeet, T. H. H.


Madel, David
Speller, Tony


Major, John
Spence, John


Marland, Paul
Spicer, Jim (West Dorset)


Marlow, Tony
Spicer, Michael (S Worcs)


Marten, Neil (Banbury)
Sproat, Iain


Mates, Michael
Squire, Robin


Mather, Carol
Stainton, Keith


Maude, Rt Hon Sir Angus
Stanbrook, Ivor


Mawby, Ray
Stanley, John


Mawhinney, Dr Brian
Steen, Anthony


Maxwell-Hyslop, Robin
Stevens, Martin


Mayhew, Patrick
Stewart, Ian (Hitchin)


Mellor, David
Stewart, A.(E Renfrewshire)


Meyer, Sir Anthony
Stokes, John


Mills, Iain (Meriden)
Stradling Thomas, J.


Mills, Peter (West Devon)
Tapsell, Peter


Miscampbell, Norman
Taylor, Teddy (S'end E)


Mitchell, David (Basingstoke)
Tebbit, Norman


Molyneaux, James
Temple-Morris, Peter


Monro, Hector
Thatcher, Rt Hon Mrs M.


Montgomery, Fergus
Thomas, Rt Hon Peter


Morgan, Geraint
Thompson, Donald


Morris, M. (N'hampton S)
Thorne, Neil (Ilford South)


Morrison, Hon C. (Devizes)
Thornton, Malcolm


Morrison, Hon P. (Chester)
Townend, John (Bridlington)


Murphy, Christopher
Townsend, Cyril D, (B'heath)






Trippier, David
Wheeler, John


Trotter, Neville
Whitelaw, Rt Hon William


van Straubenzee, W. R.
Whitney, Raymond


Vaughan, Dr Gerard
Wickenden, Keith


Viggers, Peter
Wiggin, Jerry


Waddington, David
Wilkinson, John


Wakeham, John
Williams, D. (Montgomery)


Waldegrave, Hon William
Winterton, Nicholas


Walker, Rt Hon P. (W'cester)
Wolfson, Mark


Walters, Dennis
Young, Sir George (Acton)


Ward, John



Warren, Kenneth



Watson, John
Tellers for the Ayes:


Wells, John (Maidstone)
Mr. Spencer le Marchant and


Wells, Bowen
Mr. Anthony Berry.




NOES


Abse, Leo
Duffy, A. E. P.


Adams, Allen
Dunn, James A.


Allaun, Frank
Dunnett, Jack


Alton, David
Dunwoody, Hon Mrs G.


Anderson, Donald
Eastham, Ken


Archer, Rt Hon Peter
Edwards, R. (W'hampt'n S E)


Ashley, Rt Hon Jack
Ellis, R. (NE D'bysh're)


Ashton, Joe
English, Michael


Atkinson, N. (H'gey,)
Ennals, Rt Hon David


Bagier, Gordon A.T.
Evans, Ioan (Aberdare)


Barnett, Guy (Greenwich)
Evans, John (Newton)


Barnett, Rt Hon Joel (H'wd)
Ewing, Harry


Beith, A. J.
Faulds, Andrew


Bennett, Andrew (St'kp't N)
Fenner, Mrs Peggy


Bidwell, Sydney
Field, Frank


Boothroyd, Miss Betty
Fitt, Gerard


Bottomley, Rt Hon A. (M'b'ro)
Flannery, Martin


Bray, Dr Jeremy
Fletcher, Raymond (Ilkeston)


Brown, Hugh D. (Provan)
Fletcher, Ted (Darlington)


Brown, R. C. (N'castle W)
Foot, Rt Hon Michael


Brown, Ron (E'burgh, Leith)
Ford, Ben


Brown, Ronald W. (H'ckn'y S)
Forrester, John


Buchan, Norman
Foulkes, George


Burden, Sir Frederick
Fraser, J. (Lamb'th, N'w'd)


Callaghan, Rt Hon J.
Freeson, Rt Hon Reginald


Callaghan, Jim (Midd't'n &amp; P)
Freud, Clement


Campbell, Ian
Garrett, John (Norwich S)


Campbell-Savours, Dale
Garrett, W. E. (Wallsend)


Canavan, Dennis
George, Bruce


Cant, R. B.
Gilbert, Rt Hon Dr John


Carmichael, Neil
Ginsburg, David


Carter-Jones, Lewis
Golding, John


Clark, Dr David (S Shields)
Gourlay, Harry


Cocks, Rt Hon M. (B'stol S)
Graham, Ted


Cohen, Stanley
Grant, John (Islington C)


Coleman, Donald
Griffiths, Peter Portsm'th N)


Concannon, Rt Hon J. D.
Hamilton, James (Bothwell)


Cook, Robin F.
Hamilton, W. W. (C'tral Fife)


Cowans, Harry
Hardy, Peter


Cox, T. (W'dsw'th, Toot'g)
Harrison, Rt Hon Walter


Craigen, J. M.
Hattersley, Rt Hon Roy


Crowther, J. S.
Haynes, Frank


Cryer, Bob
Healey, Rt Hon Denis


Cunliffe, Lawrence
Heffer, Eric S.


Cunningham, G. (Islington S)
Hogg, N. (E Dunb't'nshire)


Cunningham, Dr J. (W'h'n)
Holland, S. (L'b'th, Vauxh'll)


Dalyell, Tam
Home Robertson, John


Davidson, Arthur
Homewood, William


Davies, Rt Hon Denzil (L'lli)
Hooley, Frank


Davies, Ifor (Gower)
Howell, Rt Hon D.


Davis, Clinton (Hackney C)
Howells, Geraint


Davis, T. (B'ham, Stechf'd)
Huckfield, Les


Dempsey, James
Hudson Davies, Gwilym E.


Dewar, Donald
Hughes, Mark (Durham)


Dixon, Donald
Hughes, Robert (Aberdeen N)


Dobson, Frank
Janner, Hon Greville


Dormand, Jack
Jay, Rt Hon Douglas


Douglas, Dick
John, Brynmor


Douglas-Mann, Bruce
Johnson, James (Hull West)


Dubs, Alfred
Johnson, Walter (Derby S)





Jones, Rt Hon Alec (Rh'dda)
Pink, R. Bonner


Jones, Barry (East Flint)
Powell, Raymond (Ogmore)


Jones, Dan (Burnley)
Prescott, John


Kaufman, Rt Hon Gerald
Price, C. (Lewisham W)


Kerr, Russell
Race, Reg


Kilfedder, James A.
Radice, Giles


Kilroy-Silk, Robert
Richardson, Jo


Lambie, David
Roberts, Albert (Normanton)


Lamond, James
Roberts, Ernest (Hackney N)


Leadbitter, Ted
Roberts, Gwilym (Cannock)


Lestor, Miss Joan
Robertson, George


Lewis, Arthur (N'ham NW)
Robinson, G. (Coventry NW)


Lewis, Ron (Carlisle)
Rooker, J. W.


Litherland, Robert
Ross, Ernest (Dundee West)


Lofthouse, Geoffrey
Ross, Stephen (Isle of Wight)


Lyon, Alexander (York)
Ryman, John


Mabon, Rt Hon Dr J. Dickson
Sever, John


McCartney, Hugh
Sheerman, Barry


McDonald, Dr Oonagh
Sheldon, Rt Hon R.


McElhone, Frank
Shore, Rt Hon Peter


McGuire, Michael (Ince)
Short, Mrs Renée


McKay, Allen (Penistone)
Silkin, Rt Hon J. (Deptford)


McKelvey, William
Silkin, Rt Hon S. C. (Dulwich)


MacKenzie, Rt Hon Gregor
Silverman, Julius


McMahon, Andrew
Smith, Rt Hon J. (N Lanark)


McNally, Thomas
Snape, Peter


McNamara, Kevin
Soley, Clive


McTaggart, Robert
Spearing, Nigel


McWilliam, John
Spriggs, Leslie


Magee, Bryan
Stallard, A. W.


Marks, Kenneth
Steel, Rt Hon David


Marshall, D (G'gow S'ton)
Stewart, Rt Hon D. (W Isles)


Marshall, Dr Edmund (Goole)
Stoddart, David


Marshall, Jim (Leicester S)
Strang, Gavin


Martin, M (G'gow S'burn)
Summerskill, Hon Dr Shirley


Maxton, John
Taylor, Mrs Ann (Bolton W)


Maynard, Miss Joan
Thomas, Jeffrey (Abertillery)


Meacher, Michael
Thomas, Dr R. (Carmarthen)


Mellish, Rt Hon Robert
Thorne, Stan (Preston South)


Mikardo, Ian
Tilley, John


Millan, Rt Hon Bruce
Torney, Tom


Miller, Dr M. S. (E Kilbride)
Urwin, Rt Hon Tom


Mitchell, R. C. (Soton Itchen)
Varley, Rt Hon Eric G.


Moate, Roger
Wainwright, R. (Colne V)


Morris, Rt Hon A. (W'shawe)
Walker, Rt Hon H. (D'caster)


Morris, Rt Hon C. (O'shaw)
Watkins, David


Morris, Rt Hon J. (Aberavon)
Weetch, Ken


Morton, George
Welsh, Michael


Moyle, Rt Hon Roland
White, J. (G'gow Pollok)


Mulley, Rt Hon Frederick
Whitehead, Phillip


Newens, Stanley
Willey, Rt Hon Frederick


Oakes, Rt Hon Gordon
Williams, Rt Hon A. (S'sea W)


Ogden, Eric
Wilson, Gordon (Dundee E)


O'Halloran, Michael
Wilson, Rt Hon Sir H. (H'ton)


O'Neill, Martin
Wilson, William (C'try SE)


Orme, Rt Hon Stanley
Winnick, David


Palmer, Arthur
Woolmer, Kenneth


Park, George
Young, David (Bolton E)


Parker, John



Pavitt, Laurie
Tellers for the Noes:


Pendry, Tom
Mr. Joseph Dean and


Penhaligon, David
Mr. Frank R. White.

Question accordingly agreed to.

Resolved,
That this House approves the White Paper on "The United Kingdom Defence Programme: The Way Forward" (Cmnd. 8288).

BUSINESS OF THE HOUSE

Ordered,
That, at this day's sitting, consideration of Lords amendments to the British Telecommunications Bill may be proceeded with, though opposed, until any hour.—[Lord James Douglas-Hamilton.]

Orders of the Day — British Telecommunications Bill

Lords amendments considered.

Clause 4

REDISTRIBUTION OF PROPERTY, RIGHTS AND LIABILITIES AMONG WHOLLY OWNED SUBSIDIARIES

Lords amendment: No. 1, in page 7, line 22, after second "to" insert "a transfer by or".

The Minister for Industry and Information Technology (Mr. Kenneth Baker): I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Speaker: With this we may take Lords amendments Nos. 2, 3, 40, 41 and 76.

Mr. Baker: These are drafting amendments to ensure that all references to transfer of property, rights and liabilities under the Bill are phrased in the same way. They remove a number of minor inconsistencies in the language of the Bill.

Question put and agreed to.

Lords amendments Nos. 2 to 4 agreed to.

Clause 17

MARKING ORDERS

Lords amendment: No. 5, in page 21, line 19, leave out from "to" to end of line 20 and insert "a fine".

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Speaker: With this we may take Lords amendment No. 6.

Mr. Baker: The amendments remove the penalty of imprisonment for the offences in clauses 17 and 18. In the light of consultations following the tabling of the amendments in another place, we concluded that imprisonment would not be an appropriate penalty. Therefore, the penalty on indictment will simply be an unlimited fine.

Question put and agreed to.

Lords amendment No. 6 agreed to.

New Clause A

ENFORCEMENT OF SECTIONS I7 AND I8

Lords amendment: No. 7, after clause 19, insert—
A.—(1) A relevant authority shall have power to purchase apparatus, and to authorise any of their officers to purchase apparatus on their behalf, for the purpose of ascertaining whether sections 17 and 18 and orders made under those sections (in this section referred to as 'the relevant provisions') are being complied with.
(2) Every local weights and measures authority in Great Britain shall have power to enforce the relevant provisions within their area; but nothing in this subsection shall be construed as authorising a local weights and measures authority in Scotland to institute proceedings for an offence.
(3) In this section 'relevant authority' means—
(a) in relation to Great Britain, the Secretary of State or a local weights and measures authority on whom a power to

enforce the relevant provisions is conferred by subsection (2);
(b) in relation to Northern Ireland, the Department of Commerce for Northern Ireland; and
(c) in relation to the Isle of Man, the Board of Consumer Affairs."

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker (Mr. Bernard Weatherill): With this we may take Lords amendments Nos. 8 to 13, 26, 88, 102 and 103.

Mr. Baker: The clause clarifies the means of enforcing the marking orders that will be made under clauses 17 and 18 concerning telecommunications apparatus. These clauses were added to the Bill on Report in this House. At the time I undertook to consider further whether additional enforcement powers were needed. This we have done. We have concluded that it would be appropriate for marking orders under the Bill to be enforced by local weights and measures authorities, and this clause makes the necessary provisions.
The clause is based on corresponding sections of the Trade Descriptions Act 1968, which also contain a power to make marking orders enforceable by local weights and measures authorities. Subsection (1) makes clear that relevant authorities, which include local weights and measures authorities and the Secretary of State, have the power to make test purchases of apparatus and prevent a defendant from claiming that the purchase had been made solely to entrap him into committing an offence.
Subsection (2) authorises local weights and measures authorities to enforce the marking order provisions and thus to bring prosecutions as and when they see fit, except in Scotland, where prosecutions are brought by the procurator fiscal.
I hope that hon. Members will agree that these enforcement provisions are right—bearing in mind that local weights and measures authorities deal with other marking orders—and will agree to the new clause. You have coupled this amendment, Mr. Deputy Speaker, with Lords amendments Nos. 8 to 13, 26, 88, 102 and 103, with which the Government also agree. The amendments may appear complicated, but their effect is simply to transfer the content of clause 25 to schedule 4 and to make the necessary consequential amendments.
Clause 25 relates to the transfer to British Telecom of that part of the pre-1969 Post Office borrowing that relates to telecommunications and is therefore essentially a transitional provision. These amendments achieve the transfer to schedule 4, which contains the rest of the transitional provisions.

Question put and agreed to.

Mr. Deputy Speaker: Lords amendments Nos. 8 to 13 have been discussed. Is it the wish of the House that I put them together?

Mr. John Golding: On a point of order, Mr. Deputy Speaker. Has amendment No. 9 been moved?

Mr. Deputy Speaker: It was discussed with Lords amendment No. 7.

Mr. Golding: I did not hear Lords amendment No. 9, to clause 26, called. It is an amendment on which Opposition Members wish to speak.

Mr. Deputy Speaker: I recognise that we are proceeding rather rapidly. I think, however, that I made the position clear when I read out the amendments linked with Lords amendment No. 7. Has the hon. Gentleman a list of the selected amendments? It is clearly stated. Does he wish to speak?

Mr. Gregor MacKenzie: Further to the point of order, Mr. Deputy Speaker. Opposition Members did wish to make contributions on Lords amendments Nos. 8 to 13, on the financial provisions. The Minister spent most of his time, quite properly, talking about marking regulations. I would have thought that a short discussion on the financial question would have been appropriate. I was not aware that Lords amendment No. 9, which we are concerned to discuss, had been dealt with by the Minister. I hope that the matter can be clarified.

Mr. Baker: Further to the point of order, Mr. Deputy Speaker. I shall be happy, if the right hon. Gentleman so wishes, to have a short debate on the finances of BT. This would be an appropriate amendment, I submit, for such a debate to take place.

Mr. MacKenzie: I am trying to be helpful. A short discussion on Lords amendment No. 9 would be appreciated.

Mr. Deputy Speaker: A debate is possible within this group of amendments. There is no need to wait until we reach the appropriate stage of the Bill.

Mr. MacKenzie: I regret the slight confusion. We are moving at some pace. The Opposition do not wish to prolong discussion unnecessarily. The amendment provides an opportunity to discuss the whole question of the financing of British Telecommunications although not at great length, as in Committee or on Report. I am not pressing a vote, but it would be sensible to spend a few minutes discussing the issue.
In Committee my hon. Friends and I pressed strongly an amendment that would allow BT to borrow sterling from non-Government sources. The Government were kind enough to accept the principle. There is, however, not much point in the Minister of State's accepting my suggestion if the principle of non-Government sterling borrowing is not to be carried out in practice.
For this year and, as things are working out, in the critical years ahead, BT will deliberately be kept short of investment finance. I understand that the shortfall for 1981–82 alone will be about £350 million. Investment in new, highly advanced equipment has already been cut by about £230 million. When every other advanced country is increasing greatly its investment in national telecommunications and providing the finance to do so, the Government are forcing BT to cut back.
The recent £200 million increase in BT's cash limit for one year is not good enough. At a time when investment throughout the economy is collapsing and it is evident that unemployment is increasing massively, it is economic nonsense to refuse BT the financial flexibility to invest in profitable projects that could be of great benefit to the nation for a great many years. That is political dogma at its worst.
The heart of the problem is the way in which the Treasury Ministers choose to operate the cash limits. For obscure theoretical reasons they choose to include in the definition of public borrowing all the net external borrowing of BT, irrespective of source. Even in the increasingly rare circumstances where finance is raised from non-Government sources and there is no real chance of BT's defaulting on the loan, it is still classed as a 100 per cent. borrowing.
The Treasury is often described as the nationalised industries' banker. If any commercial bank assumed that all its customers would default on all their loans, arid 100 per cent. provision had to be made for that, it would not survive in business for very long. Yet that is exactly the attitude of Treasury Ministers towards BT. They think that it is to be defined as a 100 per cent. bad risk. Some claim that additional finance for BT will crowd out private investment. Let it be said plainly that a dispassionate survey of all the evidence shows that, at best, the claim is not proven. The Opposition would go further. We believe that there is no evidence to support the crowding-out theory at a time of collapsing investment in the economy.
The practical reality is different from the theoretical world of Treasury Ministers. There is every reason to assume that city institutions will welcome BT's raising loan finance on the capital markets. All the inquiries into the availability of finance for investment show that there is no shortage of funds for profitable investment—and BT is certainly profitable. Underwriting a BT loan issue is not a problem, yet the Government refuse to allow BT to borrow and to do what they are encouraging other businesses to do, namely, invest in the high technology of tomorrow.
It is all too easily forgotten that the Government's refusal to allow BT to borrow finance for investment will force up telephone charges. That is because BT must provide most of its finance from within the business itself. As I understand it, a statement published only the other day by the chairman of BT, about a survey of BT's financial prospects, said that that would cost residential customers an additional £450 million and those who use pay telephones an additional £135 million. That is because of the extremely high self-financing ratio. To achieve that, prices have to be raised more than is necessary. That is grossly unfair on BT's customers.
It is disingenuous of the Government to blame BT and other nationalised industries for raising their prices more than other companies. The Government's cash limit policies have forced them to do that. If the Minister and his colleagues peruse the statement made by Sir George Jefferson—he was appointed by the Secretary of State, and I regard him highly—they will see that in his judgment that policy will cost that much more for residential customers and those who use pay phones.
That is something to which the Minister has to address himself. Sir George is not the only person to make such comments. My hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding), who is associated with the Post Office Engineering Union, has made comments that are much in line with those made by Sir George. They raise questions that must be answered.
The refusal to give British Telecommunications the ability to borrow on anything like the scale that is necessary is extremely bad commercial practice. Sensible and prudent gearing is as relevant to British


Telecommunications as it is to ICI or any other large commercial company. It is clear that BT will require financial flexibility. Other countries have learnt this over a long period.
The Opposition, the trade unions and BT have said that they are worried about cash limits. It is a worry, because the lack of flexibility caused by cash limits will have a serious effect on telephone users. The Minister must address himself to these issues and make a public response.

Mr. Golding: As my right hon. Friend the Member for Rutherglen (Mr. MacKenzie) said, I speak for the Post Office Engineering Union. The union is extremely concerned about cash limits, but it is the Beesley report that casts the largest shadow over British Telecommunications. We have had no opportunity to make our observations on the report on the liberalisation of the use of the BT network. We want modernisation and expansion for BT and the ability to fulfil a social role. It is BT's prime duty to provide an efficient telephone system at a price that the bulk of the public can afford to pay. If we are to achieve that, we must, among other things, invest heavily, and certainly more heavily than is being allowed. That argument was advanced eloquently by my right hon. Friend.
What contribution could the Beesley report make to the end that I have in mind? The answer must be "Nil". If the report is implemented, it will make it more difficult for both management and staff in BT to provide a service to the customer of which they can be proud. Both the chairman, Sir George Jefferson, and the unions speak with a common voice on the threat that it poses for an effective telecommunication system.
Professor Beesley advocates a free-for-all, with no protection for BT's revenue or for the interests of British manufacturers, who are becoming increasingly alarmed at the implications of the Beesley report. Professor Beesley advocates the unfettered use of rented circuits for all and sundry, both nationally and internationally. He advocates the creation of competing networks—that is, private transmission.
10.45 pm
On reading the report, my strong belief was that those were ideological conclusions, which were arrived at to support the ideological commitment of the Secretary of State. My view is shared by many who do not share my political commitment. I believe that the conclusions of the report were arrived at before the report was written. The report smacks of conclusions reached before the study was even begun.
The POEU, in submissions, has expressed its concern at the short length of time of the study. In the study it is admitted that it has taken only three months to complete. That is insufficient time to deal with the complex issues faced in this area. The union is also upset at the tight schedule for discussion and consultation. I think that it would be unreasonable to try to meet a deadline this month. It would be totally unreasonable, given the views of the chairman of British Telecommunications, who is critical of the time scale of discussion. If I do not put the chairman's words on the record, it is only because I want to be more brief this evening than I was yesterday.
The Minister of State knows that Sir George Jefferson not only says that precipitate implementation of the Beesley recommendations would cause irreversible damage but makes it clear that it would be wrong, in the short time that we have, to reach conclusions before the end of the month.
The Beesley report has been criticised. The POEU did an analysis of the way in which the evidence was collected. It appears to have been collected at a superficial level. When the people who are cited in Professor Beesley's report as having given evidence were approached, it was found that some of them did not appreciate the way in which their remarks would be used and had not understood that they had given evidence in any formal sense at all.
On the basis of the level of the collection of evidence, it seems that the report is an unsatisfactory basis on which to take a decision of such magnitude. There is no analysis worthy of the name in this short report. Its conclusions do not seem to be derived from the argument. For example, Professor Beesley finds that British Telecommunications is liberal and that Britain has led in Europe in data processing. He concludes, however, without any evidence, that as a matter of ideology increasing competition will further enhance the prospect of success.
If Professor Beesley had been given British Rail to examine, he would have built a line parallel to the Euston to Birmingham inter-city line to provide competition. He would have put a line between the motorway and the British Rail line. He would have allowed private carriers to run Pullman coaches on the inter-city line. He came to conclusions that would have allowed British Rail to become involved in British Telecommunications. That is the absurdity of his conclusions.
The POEU has taken the proposals seriously. It has tested them against the American experience. It commissioned a study by Logica, the firm used by Professor Beesley. From that study, it is clear that profitable business would be lost. It is clear also that that would be lost from a small number of business users rather than from the general residential subscriber. The consequences would be severe.
Logica estimated that the increase in cost to subscribers would be 25 per cent. One can understand that, because the fixed cost of sending one call is high. One must have a system to transmit any call. The high cost of installation, operation and maintenance of the system has to be met. The system is also needed for defence.
Profit is made from trunk and international calls. That is true of almost all countries. Local calls and rentals are subsidised from trunk and international calls. If we cream off trunk and international calls, nothing will be left to subsidise rentals and local calls. Residential and business subscribers will suffer.
It is not only the present subscriber who will suffer. It is clear from Sir George Jefferson's submission that he is concerned that there might not be revenue for the research and development that will be needed in years to come. It is no wonder that Sir George and many others are in a panic. My guess is that the Treasury, if it has woken up sufficiently to the financial implications of these proposals, will also be beginning to panic. If it is not, it ought to be, because the financial implications for the State and the Government are great. The Government cannot afford to give more public money to businesses in this indiscriminate way.
The increase in price is not the only evil consequence. British manufacturers are panicking because, according to at least one manufacturer, foreign equipment will put one-third of their output at risk.
More profoundly, British manufacturers are dependent for their well-being on the prosperity, modernisation and expansion of British Telecommunications, because 80 per cent. of their output goes to BT. It is no wonder that they are beginning to regret campaigning for the Bill. As I have said, foreign companies will gladly help the Government to smash British industry by this means.
I was interested to read in The Guardian of 29 June:
The unannounced NEDC attack on Beesley was made by the electronics EDC—the only national forum for the industry including Whitehall, management and union representatives.
It echoed many of British Telecom's arguments—that one effect of adopting Beesley would be to raise domestic phone charges; that much more time was needed to consider such fundamental changes; and that the industry was being damaged by the uncertainties.
To a large extent, that sums up my position.
The POEU would wish to say in the loudest possible voice that it is imperative that the social role of telecommunications is allowed to continue, that we do not smash the telephone system in the rural areas, that we do not impede the modernisation and growth of the system for the residential subscriber and that we do everything possible to make it possible for all to have an efficient telephone service. The preservation of the monoply would mean the provision of telephones for many more people than would ever be likely under a Beesley regime.
I therefore appeal to the Minister. We do not want a Beeching axe on telecommunications. Professor Beesley's recommendations would clearly mean a Beeching-type operation, which would be devastating for the future of British Telecommunications.

11 pm

Mr. John McWilliam: I intend to be brief. Like my hon. Friend the Member for Newcastle-under-Lyme (Mr. Golding), I am a sponsored member of the Post Office Engineering Union. I listened to the contributions made by my right hon. Friend the Member for Rutherglen (Mr. MacKenzie) and by my hon. Friend the Member for Newcastle-under-Lyme and I was reminded of events a year ago, when I first visited the United States of America. At that time the first privatisation took place, and American Telephone and Telegraph carried traffic for the first time to major centres on private lines that had been provided by others at a lower cost. At the time, American Telephone and Telegraph obviously objected.
When I visited the United States of America this year, American Telephone and Telegraph had gone further and had proposed legislation in Congress to enable it to compete fairly with those who were competing unfairly as a result of the alleged opening up of the system. American Telephone and Telegraph recognised the impact that opening up the system would have on the type of service that it provided.
Although I complain bitterly about the Government's acceptance of the Beesley report and all that that entails, my major complaint is that the report was published after the conclusion of our Committee proceedings. We did not have the opportunity to discuss the Beesley report when we debated the Bill, because it was not published until we had concluded our deliberations.
However, it was written some time before that. I condemn the Government because they had made up their mind about the answer that they wanted from the Beesley report. I condemn them because they knew what Beesley was saying and because in Committe we did not have the opportunity to discuss the Bill's provisions adequately—particularly its financial provisions.
We cannot accept the provisions that we have been left with as anything other than a shabby compromise and a tawdry structure of something that should have been discussed in Committee. However, the Government denied us the knowledge and evidence of Beesley. They denied us the opportunity to examine the report in detail in Committee. I invite the Government to accept that point and to accept that more important than political principle is the acceptance of the fact that we are dealing with a telecommunications system that is supposed to serve people, and not a political interest.

Mr. Kenneth Baker: Two separate subjects have been raised that are clearly interlocked. I refer to the points raised by the right hon. Member for Rutherglen (Mr. MacKenzie) about the financing of BT and the point raised by the hon. Member for Newcastle-under-Lyme (Mr. Golding) and the hon. Member for Blaydon (Mr. McWilliam) about the Beesley report.
I assure the right hon. Member for Rutherglen and the House that the Government give a high degree of priority to the capital programme for BT. It is the highest capital programme in the country and amounts to £6 million per day. I am glad to say that since we have been in office we have been able, each year, to increase the BT's capital investment programme. It now stands at £1·9 billion. That is a huge sum of money. Of all the nationalised industries, the first one to be allowed to increase its external finance limit was BT. Earlier this month I was pleased to announce that the external finance limit for BT had been increased by £200 million.
The Government are therefore concerned to make as much finance as possible available for BT's investment programme within the constraints of the current economic situation.
Following an adjustment for the financial limit for 1980–81 there was a net borrowing allowance of £223 million. That compares favourably with other recent years when net repayments to the Exchequer have been required. The financing available to BT in 1981–82 has been reset, after review, to a total net borrowing of £380 million.
Concern has been expressed about the operation of the Government's borrowing controls. The right hon. Member said that cash limits give him concern. He is not alone in that. Cash limits have given successive Governments and nationalised industries concern. However, there are good reasons why it is necessary for BT and other nationalised industries to be subject to limits on their external financing. The right hon. Member and his right hon. Friend the Member for Manchester, Openshaw (Mr. Morris), as members of the Labour Government, will readily recognise that. If one allowed all nationalised industries to borrow in the market, as I made clear in Commitee, there would be a great rush to the market. If they were all given carte blanche to go, it would have a massive effect of crowding out. It would also have a powerful thrust to push interest rates much higher very quickly. All Governments recognise that there must be an orderly queue for borrowing by State corporations.
It is clear that BT is well up that queue. It was the first of the nationalised industries to have its EFL increased this year. The Government are continuing to look at ways of maximising the finance available to BT, including the possibility of its borrowing directly from the money markets. The Government would welcome joint ventures that would inject private sector finances into some areas of investment, such as the supply of subscriber apparatus and the provision of services auxiliary to the main network. I hope that BT will make proposals in those areas. At the same time, the introduction of private sector competition in some areas, following the relaxation of the monopoly, would help to free resources for investment in the main telecommunications network.
The Government are seeking to develop a new form of financing instrument, analogous to equity in the private sector, whereby BT could raise finance directly from the money markets, which will increase the pressures on it to trade efficiently. The Bill provides the necessary powers to allow direct market borrowing, if an appropriate financial instrument can be designed. We are continuing to examine the possibility of designing one.
The House will also know that I announced earlier this month that international financial consultants would be considering our request to examine the internal operations of BT to see whether there is scope for savings, because one of the sources of finance available to the investment programme is self-generation through efficiency and a more effective way of doing things.
The hon. Members for Newcastle-under-Lyme and Blaydon both spoke with great experience about the Beesley report. I have read the Beesley report, as the House would expect. I have also read the submissions on the report—the yellow book from BT and the red book from the Post Office Engineering Union. I have written down two adjectives—"thoughtful" and "interesting". I did not put "convincing". The submissions add to the sum of human knowledge.
As the House and the two hon. Gentlemen will know, there was a useful conference last Friday at which BT, the Post Office Engineering Union and other interests were represented. The meeting was chaired by my Department and examined the case for and against the report. The case for Beesley was put not just by Professor Beesley but by other groups and associations. The case was also put against the Beesley report.
We are still considering the representations that we have had and the report. There are important decisions here—the question of whether we will permit value added network services and the question of the additional network. The House will know that a specific proposal has been made to the Government by a consortium—the Mercury proposal—and we shall consider it most carefully. There is also the question raised by Professor Beesley of the resale of international lines. As the hon. Member for Newcastle-under-Lyme said, the matter raises important questions concerning the operation and finances of British Telecom.
The hon. Gentleman said that he looked on the report as a threat to British Telecom.

Mr. Gregor MacKenzie: The Minister said that there was an interesting conference in the Department of Industry last Friday, when the Minister and/or his officials

heard the views of British Telecom, the unions and others. He listened to and read the submissions. There is one notable and curious omission. Some of us hark back to the days when the House of Commons would be consulted from time to time on such matters. What about giving hon. Members a wee chance now and again to express a view? Will the Minister seek that advice and guidance before finally making up his mind about Beesley?

Mr. Baker: There was a wee chance tonight, which was taken by two of the right hon. Gentleman's hon. Friends. I understand the concern, but any decision on a significant aspect of Beesley would be reported to the House.
The hon. Member for Newcastle-under-Lyme said that he looked on the proposals as a series of threats to British Telecom, but some trade associations and companies look on them as a series of opportunities. There are two sides to the argument. The hon. Gentleman said that there was a possibility of smashing the rural network. That is not the Government's purpose. It would not be the purpose of any Government.

Mr. Golding: I did not say that it was the Government's purpose. It could be a consequence. I did not charge the Government with wishing to smash the rural network.

Mr. Baker: I am aware that that is one argument, which we shall have to take into account when considering the effect of the liberalisation and the whole financial situation of Beesley. However, as I made clear in Committee and on Report, we would not agree to proposals that would smash the rural network and impede growth in the domestic area. We are aware of the considerable services that British Telecom provides right across the nation.
The debate has been useful. We have had a short debate on the capital financing of BT, which is important, and a short debate on Beesley.

Lords amendments Nos. 8 to 13 agreed to.

Clause 31

THE CORPORATION'S ACCOUNTS AND AUDIT THEREOF

Lords amendment: No. 14, in page 31, line 20, after "has" insert
after consultation with the Corporation and".

The Under-Secretary of State for Industry (Mr. Michael Marshall): I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this we may take Lords amendment No. 59.

Mr. Marshall: The amendments require the Secretary of State to consult BT and the Post Office before making directions concerning the information to be contained in their annual accounts or the manner in which it is to be presented. Such consultation would always take place and the amendments give statutory recognition to it.

Question put and agreed to.

Clause 33

POWER OF THE SECRETARY OF STATE TO MAKE ORDERS ABOUT PENSIONS

Lords amendment: No. 15, in page 33, line 3, after "of' insert "any".

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this we may take Lords amendments Nos. 16 to 22, 60 and 61.

Mr. Baker: This is a series of amendments to clauses 33 and 76 which clarify the drafting of those pensions clauses in a number of ways, and it may be helpful if I take them together. They concern important matters. My hon. Friend the Under-Secretary and I have been consulting the Post Office, the trustees of the Post Office pension fund and the unions concerning the future of the fund. The consultations are almost complete, but we want time to reflect on the issues and we do not propose to take any hasty decisions.
Hon. Members will probably be aware that the Post Office Board has recommended that the existing pension fund should be split into two, with one fund for each corporation, but that the trustees and the unions would prefer the single fund to be maintained. A number of compromise solutions have also been suggested which involve varying degrees of separation, including the possibility of two sets of trustees or two schemes but with a common investment fund.
I am sure that all hon. Members would readily agree that the Bill should not exclude the possibility of implementing any solution that had the support of the parties concerned—I emphasise that—or which was felt to be the most acceptable compromise. The amendments are designed to achieve that end.
Amendment No. 15 makes it clear that orders may be made about categories of persons to which the clause applies and need not apply to all such persons. This might be necessary if a specific order dealt only with members of the Post Office, or convenient for dealing with some other group of BT employees.
Amendment No. 16 amends the drafting of the existing clause 33(1)(b) and 33(1)(c) to take account of the fact that any transfer of liabilities under the clause or of the assets of a pension fund will be from trustees of one pension fund to another. The new paragraph (c) also allows the apportionment of a fund held jointly for Post Office and BT schemes. The new paragraphs (bb) and (bc)put beyond doubt that the Secretary of State can use his powers to provide for the maintenance of a single pension fund in the case where there are two sets of trustees, one for the pensions of each corporation, or for the holding of the assets of the fund by investment trustees. These are both options that have been suggested by the Post Office, the trustees or the unions.
Amendments Nos. 17 and 18 are drafting amendments which make it clear that the references in clause 33(1)(d) are to section 47 of the 1969 Act.
Amendment No. 19 and its equivalent to clause 76 are designed to ensure that all relevant matters can be covered in any ministerial order, and amendment No. 21 ensures that orders can cover the payment of administrative expenses in relation to pensions as well as the payment of the pensions themselves.
Amendment No. 20 ensures that the orders can also modify any statutory provision or contract of employment, but only in so far as it might be necessary to give effect to an order. That is necessary because the creation of a BT pension scheme might require modification of section 47(10) of the 1969 Act to allow the payments in relation to employees of the Postmaster General's department to be made by the Government to trustees of a BT scheme as well as those of a Post Office scheme. Amendment No. 61 makes the corresponding change to clause 76. Similarly, it is a condition of employment in the Post Office that most employees belong to the Post Office pension scheme, and if a new BT scheme were created that condition would have to be changed for BT employees to refer to the new scheme.
Amendment No. 22 corrects a drafting error and ensures that the clause applies to all persons who leave Post Office employment before the appointed day.
This is a complex set of amendments, and I hope that I have explained them to the House's satisfaction. I should like to stress again that many of them are merely to ensure that all possible solutions to the pension fund problem can be implemented under the Bill.
The Government have not yet come to a conclusion, but we intend to proceed with the maximum degree of consent. I am sure that hon. Members will agree that it would be wrong for the drafting of the Bill to rule out particular solutions before decisions had been taken. I hope that the House can agree to the amendments.

Mr. Charles R. Morris: I agree that Lords amendment No. 16 gives more clarity in the arrangements for a possible splitting of the Post Office superannuation fund. However, it also focuses attention on the gravity of the decision that the Minister will take on splitting the fund. That decision will touch the lives of 400,000 employees and members of the staff of the Post Office and British Telecommunications. It will affect the future well-being of 2 per cent. of the working population of this country. That is a measure of the decision if the Minister and the Government decide to proceed with the splitting of the fund.
The fund is the largest superannuation fund in Britain today, with assets of £3 billion and investments in 1,470 companies. The split would be against the advice of the trustees and against the wishes of 90 per cent. of the Post Office staff and employees, as represented by their recognised trade union.
I was very encouraged when the Minister said that the Government would seek a compromise that would attract the maximum support of the parties concerned. The only people who have argued in favour of splitting the fund are the chairmen of the two corporations and, perhaps, individual Ministers. I know that the hon. Gentleman himself is not enamoured of the possibility of splitting the fund. Everyone who participates in the fund is opposed to the split.
In Committee and on Third Reading one phrase came easily to the lips of Ministers and all the other Conservative Members who spoke, and I could understand the justification for it. They reiterated that nobody would be disadvantaged by the split. It sounded encouraging, but we have had no proof. The 400,000 staff are becoming increasingly anxious about the proposed split.
If the Minister can demonstrate tonight that the pension rights of not one member of the Post Office staff will be


disadvantaged in any way, let him say so clearly and unequivocally. We have been told that the split will mean an additional £1 million administrative expenditure, yet we have also been told that nobody will be disadvantaged. There is a wide age variation in the composition of the various postal and telecommunications grades to be covered by the two funds, yet we are told that nobody will be disadvantaged. We and the Post Office staff want to see the proof.
We understand the position in which the Minister finds himself. We take solace from the fact that he has said that he will not rush into making a decision. He said tonight that he wanted time to reflect on this crucial matter of splitting the fund. I hope that he will reflect and that he will give individual members of the Post Office staff the opportunity to express their concern, anxieties and views. This issue touches the lives and future well-being not only of Post Office staff but of their families.

Mr. Harry Ewing: It is not my intention to delay the House for more than a few minutes. I wish to support my right hon. Friend the Member for Manchester, Openshaw (Mr. Morris) because we are sponsored members of the Union of Communication Workers.
The Union of Communication Workers has been bitterly opposed to the splitting of the Post Office throughout the proceedings on the Bill. However, it has now organised its headquarters to take account of the new structure in the Post Office. But all the unions representing Post Office workers are united in not wishing to have the superannuation fund split in the way that the Post Office Board has advised the Minister to divide it.
The only advice that the Minister has had in favour of splitting the fund has come from the Post Office Board. The trustees and the 400,000 members of the fund are certainly opposed to the separation.
The fund belongs neither to the Post Office nor to the Government but to its 400,000 members, who are employed by the Post Office. I am sure that the Minister, being the reasonable man that I know him to be, will not want to take a decision of such magnitude without knowing the views of the 400,000 people who make up the membership of the fund.
My right hon. Friend the Member for Openshaw and I have the good fortune from time to time to be invited to lecture at our union school. Students constantly ask "What is to happen to the Post Office superannuation fund?"
The Minister may say that no member will be disadvantaged as a result of splitting the fund. With my experience of superannuation, I accept that is always true at the point of separation, but, as year follows year and as different investment policies are followed, very soon the two sets of benefits being paid to the two groups making up the new divided superannuation fund get out of line.
The Minister does not need to go to the barricades on this issue. After all, he has got the basic split of the business. He has the two businesses of telecommunications and posts. The Secretary of State for Industry's ideology has been fulfilled in that regard.
I believe that the Minister is privately convinced that dividing the fund is a disastrous step to take. I hope that in a gesture of good will to the 400,000 members of the fund he will not further consider dividing the fund.
All these amendments give me cause not for concern but for exercising caution. With these amendments the Minister has given himself more flexibility to cover all the eventualities during his consideration. But I still plead with him to return to the present position and to maintain the unified superannuation fund, in the knowledge that the fund belongs not to the Post Office or to the Government but to the 400,000 employees.

Mr. John G. Blackburn: The right hon. Member for Manchester, Openshaw (Mr. Morris) is right to draw our attention to this aspect of the matter. In Committee he drew our attention to it with force and determination. We are talking about the pension arrangements for 400,000 people, as has been graphically outlined.
Perhaps I might direct the attention of my hon. Friend the Minister of State to something that I have said previously, and which I now re-emphasise. When the Carter committee produced its report in 1977, it viewed with a little caution the assets of the superannuation fund, to see whether it was in a position to meet its liabilities. Yet again, on behalf of those whose life savings and pension arrangements are involved, I say that if there is to be a divide, we must make sure that when those funds are passed over they are in a sound, healthy state in order to fulfil the commitments on behalf of the 400,000 contributors. Yet again, unashamedly, I say that we must not pass over this pension scheme unless it is financially sound. It would be unfair to transfer this burden from a Government Department to the two sets of trustees.

Mr. Stanley Orme: Echoing what hon. Members have been saying, I welcome the Minister of State's cautious approach. The amendments do not worsen the situation. They give more flexibility to the Government. I am sure that the Minister has it in mind that we are talking about moneys that belong to 400,000 people.
When I was a Minister dealing with occupational pensions, it was borne in on me very strongly that, irrespective of what the chairmen or boards of companies say, the money concerned belongs ultimately to those who have contributed to the funds and is, in effect, part of their savings; it is crucial to them.
I am sure that the Minister does not want to do anything that will create uncertainty and problems, whether or not the fund is split and however the Government recommend that we proceed. In that regard I welcome the fact that the Minister is not rushing at this obstacle in the sense that he feels that he must get it cleared out of the way in the immediate future. I hope that he will be able to bring his proposals to the House so that we can look at them. It would be unfortunate if far-reaching decisions were taken during the recess without Members having an opportunity to examine them. The Minister of State might reflect on that matter tonight. Parliamentary time is not his responsibility. He will readily tell me that. It is the responsibility of the Leader of the House. But perhaps the Minister will bear in mind our concern to examine these matters.
This issue is separate from some of the contentious political arguments that we have had about the Post Office and the telecommunications industry. We do not in any way weaken our resolve and our opposition generally.


However, as regards the pension arrangements, there is, I hope, much more of a meeting of minds, as has been expressed this evening.
Perhaps the Minister will give us his reflections on those matters.

Mr. Kenneth Baker: I am grateful for the opportunity provided by this short debate for right hon. and hon. Members to make the points that they have made. As the right hon. Member for Salford, West (Mr. Orme) said, parliamentary time is not within my control, but I have noted what he said. I suspect, however, that if I made a decision with which he concurred he would not mind if I announced it during the recess, but that if he did not concur he would expect me to make it in some way to Parliament. I understand the point.
I also understand the concern expressed by the right hon. Member for Manchester, Openshaw (Mr. Morris). He expressed it also in Committee, as did the hon. Member for Stirling, Falkirk and Grangemouth (Mr. Ewing). I assure my hon. Friend the Member for Dudley, West (Mr. Blackburn) that if the pension fund were to be split there would be no change in the overall funding arrangements for any assets or liabilities of the fund. In particular, the Government would continue to make the payments now made under section 47 of the 1969 Act.
I was asked to reassure pensioners and those who are expecting to receive pensions. The Bill provides that no order that can be made can remove or diminish any existing pension rights. I re-emphasise that. The Government would much prefer to give effect to a solution endorsed by all interested parties, but it must be accepted that there may be disagreement and that there must be some means of resolving such disagreement. That responsibility must fall on the Secretary of State, who is accountable to Parliament for his actions. That is why the powers contained in these amendments are needed.

Question put and agreed to.

Lords amendments Nos. 16 to 23 agreed to.

Clause 55

POWER OF LOCAL AUTHORITIES TO CONTRIBUTE TOWARDS NEW OFFICES OR FACILITIES

Lords amendment: No. 24, in page 44, line 8, leave out
their area or any part of it
and insert
the whole or any part of their area

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this we may take Lords amendment No. 25.

Mr. Marshall: These are drafting amendments to clarify clause 55.

Question put and agreed to.

Lords amendments Nos. 25 and 26 agreed to.

Clause 57

INTERPRETATION AND EXTENT OF PART I

Lords amendment: No. 27, in page 45, leave out line 31.

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this we may take Lords amendment No. 66.

Mr. Baker: These amendments simply move the definition of the word "pension" from clause 57 to clause 85, This is necessary because the term "pension" also appears in clause 76, in part II, and the definition must refer to both parts.

Question put and agreed to.

Lords amendment: No. 28, in page 45, line 44, leave out "12(2)" and insert "12, 17, 18"

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this we shall take Lords amendments Nos. 29 and 30.

Mr. Baker: These are drafting amendments to deal with the application of the Bill to the Channel Islands and the Isle of Man.

Question put and agreed to.

Lords amendments Nos. 29 and 30 agreed to.

Clause 58

POWERS OF THE POST OFFICE

Lords amendment: No. 31, in page 46, line 23, after "For" insert "paragraphs (a) to (d) of'.

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this, it will be convenient to take Lords amendments Nos. 32 to 34, 38, 87 and 89 to 92.

Mr. Marshall: This group of amendments, while appearing rather complicated, in fact perform a simple function and—I hope it will be agreed—a useful one. At present this clause, which sets out the powers of the new Post Office, is due to come into operation on the appointed day. However, the Post Office has told us that it would like to take advantage of its new power to provide counter services for nationalised industries before that day. These amendments provide that this power, particularly under section 7(1)(f) of the 1969 Act, as inserted by clause 58(1), will come into effect on Royal Assent.
I am sure that all hon. Members will agree that the Post Office should be allowed to avail itself of this new power at the earliest possible opportunity, and will accept the amendments.

Question put and agreed to.

Lords amendments Nos. 32 to 34 agreed to.

Lords amendment: No. 35, in page 47, line 43, leave out "by whomsoever run".

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 36 and 37.

Mr. Marshall: These three amendments to the definition of "telepost service" in clause 58 are merely drafting. They put beyond doubt that the Post Office may transmit telepost messages by a telecommunications system no matter who runs the system; that is, it will not be confined to using its own system.

Question put and agreed to.

Lords amendments Nos. 36, 37 and 38 agreed to.

Clause 59

GENERAL DUTY OF THE POST OFFICE

Lords amendment: No. 39, in page 48, line 10, leave out "the Post Office Acts" and insert
Part III of the 1969 Act or this Part".

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 44, 54 and 62.

Mr. Marshall: These amendments are all drafting, clarifying references to the Post Office Acts and making some minor changes to the definitions.

Question put and agreed to.

Lords amendments Nos. 40 and 41 agreed to.

Clause 66

EXCLUSIVE PRIVILEGES OF THE POST OFFICE WITH RESPECT TO THE CONVEYANCE ETC. OF LETTERS

Lords amendment: No. 42, in page 55, line 18, leave out "Part" and insert
section and section 67—
correspondent", in relation to a letter or other communication, means the sender or the addressee; "employee", in relation to a body corporate, includes any officer or director of the body corporate and any other person taking part in its management, and "employer" and other cognate expressions shall be construed accordingly;

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it will be convenient to take Lords amendments Nos. 43, 45 to 53 and 55.

Mr. Baker: This is probably the last series of substantive amendments. They all relate to the postal monopoly provisions in clauses 66 and 67. They are somewhat complex but are designed to take account of a number of representations that have been made to us by the Post Office and by other bodies.
Amendments Nos. 42, 43, 46 and 47 are fairly straightforward drafting amendments. Amendment No. 42 inserts a definition of "employee", which I shall explain in the context of amendment No. 50, and it also adds a definition of the term "correspondent" to mean
the sender or the addressee".
Amendment No. 43 is consequential on that. Amendments
Nos. 46 and 47 are pure drafting, changing "addressee" to "addressees".
The more substantial amendments are as follows. Amendment No. 45 extends the exemption in clause 67(1) (c) for the conveyance and delivery of a letter by a messenger sent for the purpose by the sender, to allow the addressee also to send a messenger to pick up a letter from the sender. Representations have been made to us, in particular by small businesses, that an amendment on these lines should be made. I believe that it is a sensible amendment. It removes a certain amount of illogicality in the present position, which would, for example, allow me to send a messenger with a letter direct to the addressee but would not allow me to send that same messenger to pick up a letter addressed to me from the person sending it.
Amendment 48, which was tabled to meet a point raised in Committee by my hon. Friend the Member for Dudley, West (Mr. Blackburn), makes a similar point. Hon. Members may recall that the mail order traders had expressed concern that the provisions in clause 67(1)(i) concerning the delivery of letters by persons "associated in business" with the sender would not allow them to carry on their business as they have done for many years, since it would not allow them to use their employees to pick up letters from persons other than those with whom they were associated in business. I understand that employees of mail order companies pick up letters from such "other persons", notably those who act as agents for the companies in the field.
11.45 pm
When we discussed this matter at an earlier stage my hon. Friend the Under-Secretary said that he would consider whether it was possible to make an amendment to take care of that point and promised to consult the Post Office. These two amendments are the result. Although the wording of the amendments does not limit this exemption to the activities of mail order traders, we consider that, as in the case of a messenger, it would be illogical not to allow an employee of any company to pick up letters addressed to his employer from third parties when he would be able to deliver letters to those third parties.
Amendments Nos. 48 and 50 also contain some drafting changes to take account of Post Office concern that under clause 67(1)(i) it would have been possible for employees of a group of companies to set up their own private delivery service for their own business letters rather than only business letters referring to the business of their employer or another company in the same group as their employer. That was clearly not our intention, and amendments Nos. 48 and 50 make it clear that the letters being conveyed, delivered and collected must relate to the business affairs of the company whose employee is actually delivering or picking up the letters or to the business affairs of another company in the same group as the first company. The term "group" is defined by amendment No. 53 to mean
a body corporate and all of its wholly owned subsidiaries taken together
and the term "employee" is defined in amendment No. 42 to cover managers, directors and other officers who would not necessarily be covered by the normal interpretation of this term, namely, those employed under a contract of service but who would manifestly have a business interest in the letters sent by or collected for the bodies corporate for which they worked. Amendment No. 55 is consequential on amendment No. 53.
Finally, amendments Nos. 49, 51, 52 and 53 simply make drafting changes to the exemption from the monopoly for banking instruments passing between banks. The amendments are necessary to ensure that all the documents that currently pass through the banks' clearing system are covered by the definition of "banking instrument" in clause 67(3). In particular, it has been drawn to our attention that warrants issued by the Commissioners of the Inland Revenue, the Commissioners of Customs and Excise and the Department of National Savings pass through "clearing" but are not covered by the definition of "banking instrument" as it stands in clause 67(3). That is now covered by amendment No. 51, which


also adds to the definition of banking instrument some other kinds of documents passing through the clearing system which were not previously covered, namely, bills of exchange, promissory notes and postal and money orders.
Furthermore, we have been informed that those warrants not only pass between banks but are sent back from the banks to the Department that issued them, and it has therefore been necessary to amend the exemption in clause 67(1)(j) to make that possible, by allowing banking instruments to pass between banks and between a bank and a Government Department. A Government Department is defined by amendment No. 53.
This is a somewhat complicated set of amendments, but I have explained them at some length because the questions to which they relate were raised in Committee and on Report. I hope the House will agree to them.

Mr. Blackburn: I wish to direct the attention of the House to this series of amendments because most of them originated in Committee under my name. In addition, there were representations on behalf of the Mail Order Traders Association. The position was of great concern to that industry, which employs 90,000. The original drafting of the Bill would have placed the entire traditional business in jeopardy, exactly as the Minister outlined.
In Committee assurances were given by both Ministers that these matters would be put right in another place. In a spirit of frankness and honesty I commend the Ministers for honouring that undertaking. The matters have been put right. The amendments, especially Nos. 42 and 50, now satisfy the needs of the Mail Order Traders Association and thus in law secure the future of 90,000 jobs.

Question put and agreed to.

Lords amendments Nos. 43 to 55 agreed to.

Clause 69

SUSPENSION OF THE POSTAL PRIVILEGE

Lords amendment: No. 56, in page 58, line 34, at end insert—
(1A) For the purposes of an order made under this section, any definition of a class of letters may be framed by reference to any circumstances whatever; and in this subsection "letter" has the same meaning as in section 66.

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.
Subsection (1) empowers the Secretary of State to suspend the postal monopoly
for such period and to such extent
as he may specify. My right hon. Friend the Secretary of State has said that he may use this power to suspend the monopoly entirely or in respect of a particular geographical area or in respect of a particular class of letters. In particular, he intends to use the power to suspend the monopoly in respect of time-sensitive/ valuable—that is express—letters and he has said that he will require all carriers of such letters to charge a minimum fee of £1 per item. The amendment puts beyond any doubt that the power can be used in this way.

Question put and agreed to.

Clause 70

THE POST OFFICE TO BE SUBJECT TO LIMITED LIABILITY IN RESPECT OF CERTAIN INLAND PACKETS

Lords amendment: No. 57, in page 59, line 28, at end insert
at the time when they are posted

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it may be convenient to take Lords amendment No. 58.

Mr. Marshall: Both amendments relate to the provisions on postal liability in clause 70, which amends the law in relation to the Post Office's liability for loss of or damage to letters and other postal packets. Subsection (3) amends section 30(4) of the Post Office Act 1969 to exempt the Post Office from liability if conditions laid down in its scheme are complied with.
Amendment No. 57 makes it clear that these conditions can relate only to things done before the packet is posted. For instance, the Post Office will be able to require a customer to obtain a certificate of posting before it undertakes the conveyance and delivery of a postal packet. It will not, however, be able to make production of the certificate a precondition of its being liable for loss or damage to the packet. The addition of the words in the amendment emphasises that the Post Office will be in a similar position to other suppliers of services, and I hope the House will agree that this is the right policy.
The purpose of amendment No. 58 is to ensure that the clause takes effect on the appointed day rather than at Royal Assent. The Post Office will not be able to publish a new scheme containing its terms and conditions of service, compatible with the modified section 30, until the Bill is enacted. In practice it would not be possible for this scheme to be published immediately after Royal Assent, if only because the exact date might not be known very long in advance. There would, therefore, be a danger of a hiatus when the law had been changed, but not the scheme made under it. This can be avoided by delaying the coming into force of the clause until some time after Royal Assent, as section 13 of the Interpretation Act will allow the Post Office to publish its scheme after Royal Assent but before the clause takes effect.
I am sure that the practicality of these amendments will be evident to the House.

Question put and agreed to.

Lords amendments Nos. 58 to 62 agreed to.

Clause 80

EXTENDED APPLICATION OF THE TELEGRAPH ACTS

Lords amendment: No. 63, in page 67, line 40. at end insert—
(2) For section 26 of the said Act of 1863 there shall be substituted the following section—

Determination of objections by arbitration.

26.—(1) After the receipt by British Telecommunications of such a notice of objection, either party may require the objection to be referred to an arbitrator to be appointed, in default of agreement, by the President of the Chartered Institute of Arbitrators; and the reasonable expenses and remuneration of the arbitrator shall be paid by British Telecommunications.

(2) In the application of this section and sections 27 to 29 and 33 of this Act to Scotland, any reference to an arbitrator shall be construed as a reference to an arbiter.

(3) The Arbitration Act (Northern Ireland) 1937, except the provisions set out in Schedule 3 to that Act, shall apply in relation to any arbitration under this section or section 33 of this Act in Northern Ireland as if the arbitration were pursuant to an arbitration agreement and as if this Act were such an agreement, except in so far as that Act is inconsistent with this Act."

(3) In consequence of subsection (2)—
(a) in section 24 of the said Act of 1863 the words "and send" onwards shall be omitted;
(b) in sections 27 to 29 of that Act for the words "Board of Trade", wherever occurring, there shall be substituted the word "arbitrator";
(c) in section 33 of that Act for the words "the Board of Trade" there shall be substituted the words "an arbitrator to be appointed, in default of agreement, by the President of the Chartered Institute of Arbitrators; and the reasonable expenses and remuneration of the arbitrator shall be paid by British Telecommunications"; and
(d) section 34 of that Act shall be omitted.
(4) Subsection (1) shall extend to the Isle of Man; and, subject to subsection (5), subsections (2) and (3) shall come into operation on the appointed day.
(5) Nothing in subsections (2) and (3) shall affect the operation of sections 26 to 29 and 34 of the said Act of 1863 in relation to any hearing begun before the appointed day."

Mr. Kenneth Baker: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: With this it may be convenient to discuss Lords amendments Nos. 68, 113 and 118.

Mr. Baker: This group of amendments effects an overdue reform in the Telegraph Act 1863—an old statute dating from the dawn of the age of the telephone—which governs the carrying out of works by BT, for example the placing of telegraph poles and wires. Sections 26 and 33 of the 1863 Act provide for certain minor disputes about the siting of telegraph works to be determined by the "Board of Trade". In our view, ministerial intervention in matters of this sort that mainly affect private rights is neither necessary nor particularly desirable because of the extra bureaucracy involved. Arbitration offers a simpler, speedier and more efficient but equally fair alternative. The Act already provides in section 34 for the Minister to appoint an arbitrator to determine objections on his behalf and the amendments will enable disputes to proceed direct

to arbitration. The president of the Chartered Institute of Arbitrators is empowered to act to resolve any disagreement about the appointment of the arbitrator.
As a Minister I do not want to become involved in any disputes on the siting of telegraph poles. This modest reform will affect a small but worthwhile reduction in delaying bureaucracy—a good example of the aims of the Government.

Mr. Gregor MacKenzie: The Minister's speech was one of the few occasions during the whole of the Bill when he said that there would be some sort of reduction in ministerial powers. That is a marginal reduction in the massive powers that the Minister has taken for himself in the Bill. We readily accept what he had to say.

Question put and agreed to.

Clause 82

TAX PROVISIONS

Lords amendment: No. 64, in page 69, leave out lines 26 to 32.

Mr. Michael Marshall: I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker: It will be for the convenience of the House to take with this amendment Lords amendment No. 65. I should inform the House that privilege is involved in these two amendments.
With them we may also take Lords amendments Nos. 67, 69 to 75, 77 to 86, 93 to 101, 104 to 109, 111 to 118.

Mr. Marshall: These are all drafting amendments, with the exception of amendments Nos. 86, 93 and 94, which are corrections of minor errors. Amendments Nos. 101 to 104 and 106 are minor transitional provisions and amendments Nos. 107 to 109, 111 to 112 and 114 to 117 cover the repeal of spent legislation.

Mr. Deputy Speaker: I should inform the House that Lords amendment No. 102 involves privilege, and if the House accepts it I shall cause the appropriate entry to be made in the Journal in respect of amendments Nos. 102, 64 and 65.

Question put and agreed to. [Special Entry].

Lords amendments Nos. 65 to 118 agreed to, some with Special Entry.

Orders of the Day — Fishing Industry (Fuel Oil Costs)

Motion made, and Question proposed, That this House do now adjourn. —[Mr. Mather.]

Mr. David Myles: I am particularly pleased that my hon. Friend the Minister of State has seen fit to come at this midnight hour to reply to the debate. I believe that there was some doubt about who had the responsibility. I hope that it will be clear from my speech that the Department of Energy is responsible.
My request for the debate stemmed from a letter that I wrote to the Department of Energy on 4 February of this year, to which I received a reply on 12 June. Needless to say, I was rather annoyed at the delay in replying to my letter. I was more than slightly disappointed with what was in the letter. as I had hoped for a better defence of our energy pricing policy than appeared there.
The fishermen in my constituency fish in waters in which there is a great deal of oil development. The oil industry shows no sign of having to economise or limit its spending. The fishermen have had to suffer damage to their gear from debris, although I admit that the situation has greatly improved. I shall not go on at length about that. I still hear of insensitive actions such as testing anchors just off the Moray coast, which plough up the seabed in a damaging furrow and can have dire results for fishermen.
Let us examine fuel costs. In 1979, 89 vessels costed by the Scottish Fishermen's Federation showed that fuel costs amounted to 44 per cent. of expenses. In 1980 the figure was 51 per cent. Fishermen pay for fuel with the fish that they catch. The following facts demonstrate the seriousness of the situation. I shall give figures for the three main species of white fish landed in Buckie in my constituency and the number of six-stone boxes required to buy 1,000 gallons of marine oil. The figures are dramatic. I have not cooked the books. The figures are from a reliable source and can be checked.
Taking an average price over the year, 16·5 boxes of haddock were required to buy 1,000 gallons of marine oil in 1973. In 1974 it took 24·78 boxes. In 1975 it went up to 31 boxes and in 1976 it took 35·12 boxes. In 1977 the position improved a little to 31·55 boxes. In 1978 the situation improved even more, and it took 25·68 boxes. But then the figure climbed again. In 1979 it took 29·51 boxes and in 1980 it required 46·93 boxes. No quota existed in 1973, but a quota now operates, so fishermen cannot catch unlimited amounts of fish. At the price of haddock on Monday of this week at Buckie, 81 boxes would be required to buy 1,000 gallons of marine oil.
In 1973, 22·27 boxes of whiting were required to buy 1,000 gallons of marine oil. In 1980, 70·76 boxes were required. This week 120 boxes would be required.
There is no quota on cod catches. In 1973, 12·34 boxes of cod were needed to buy that amount of oil. In 1980 32·14 boxes were required. This week's figure is also dramatic.
What adds fuel to the fire of the fishermen's ire is the comparative costs in other countries which do not have oil. A number of companies and sales offices give instructions to their skippers to refuel if possible in Denmark or Norway, where the cost of oil is about 30 per cent. lower. If they are fishing off Cornwall, they are told to go to St. Malo in France.
The group which studied allegations of unfair trading in fish found that
United Kingdom fuel prices have tended to be higher than those paid by fishermen in other Member States and in other important fishing countries such as the United States of America and Canada when prices in those markets are converted into sterling…Price differences would appear to reflect general policies of Governments on energy pricing and the commercial decisions of the supplying companies.
It goes on to quote—and no doubt the Minister may quote—the findings of that group and the relative prices in £ sterling per tonne in the various countries. What disturbs me is that the United Kingdom price in December 1980 is quoted as £133 to £195 per tonne—a fairly wide disparity—and in March 1981 as £130 to £208 per tonne. Why cannot we give a price in the United Kingdom in the same way as other countries do?
The National Economic Development Council task force report on energy pricing quoted prices at various ports. In January 1981, in Aberdeen it was £172 per tonne, in Lowestoft £153 per tonne, in Fleetwood £147 per tonne and at the Humber ports £131 per tonne. Again there is quite a discrepancy, and the Scottish fishermen do not understand why. Sadly, the price in Buckle is not given, but it is even worse.
The French, of course, subsidise the fuel for their fishing industry. M. Louis le Pensec, the French Minister for the Sea, when he was interviewed by the newspaper Le Monde, said that
immediate measures will be taken meanwhile to safeguard our fishing fleet. The doubling of the fuel subsidy programmed in the July budget is one of those measures.
That means that instead of 10 centimes per litre the subsidy will be 21 centimes per litre.
In conclusion, I plead with the Government to take careful note of the situation and ensure that their energy pricing policy does not do irreparable damage to our fishing industry, which was here long before oil was discovered and will be needed long after the oil is used up.

The Minister of State, Department of Energy (Mr. Hamish Gray): I well know that the fishing industry is among the most energy-intensive industries in the country. The cost of fuel can be well over 40 per cent. of running costs. It is therefore a subject of great concern to the fishing industry, meriting close examination and debate. I am grateful to my hon. Friend the Member for Banff (Mr. Myles) for giving the House the opportunity to discuss this matter tonight. It is typical of his enthusiasm and dedication that he should ask me to come to the House after midnight to reply to a debate that he has justly raised on behalf of the fishermen whom he so well represents.
I know that my hon. Friend will make allowances for the fact that my responsibilities lie in the energy rather than the fishing sphere. I know that the problems of the fishing industry range far beyond the cost of fuel oil, but any detailed response on such points must be for my ministerial colleagues responsible for fisheries. I shall therefore confine my comments to the subject of this Adjournment debate on energy prices as they affect the fishing industry.
I offer my hon. Friend the Department of Energy's apology for the delay that he experienced in receiving a reply to his letter. My hon. Friend the Minister, who was responsible for the division that dealt with the inquiry, was extremely angry when he discovered that such a delay had


occurred. At the time that my hon. Friend wrote, the Department was under heavy pressure on this front, and inadvertently the letter was misdirected. That was the cause of the delay. I give my hon. Friend an apology that I hope he will accept.
My hon. Friend expresses the effect of the rising fuel costs to the fishing industry most graphically. But rising fuel costs are not confined to the fishing industry or to the United Kingdom. Since the end of 1978—this is important and has a direct bearing on the subject in hand—world crude oil prices have more than doubled. Since 1973 they have risen nearly twentyfold. These massive price increases in turn affect oil product prices and industry must adjust to survive.
This year there have been several rounds of wholesale price increases. The first, in January, mainly reflected the crude oil increases announced at Bali in December. Since then, crude oil prices have been broadly constant in dollar terms, but the sterling price of crude oil to United Kingdom refiners has increased by over 20 per cent. because of the weakening of the pound against the dollar. It was for that reason that the oil companies increased their wholesale prices in March, May and again in June. Despite those increases, most United Kingdom oil companies have been making substantial losses from their refining and marketing operations, which the reduction in North Sea crude prices will mitigate but not eliminate.
There has already been one announcement of a planned refinery closure. However, my hon. Friend is concerned about prices in the United Kingdom compared with the Continent, as well as about absolute price increases within the United Kingdom. My hon. Friend will no doubt have seen the NEDC task force report. Indeed, he referred to one or two of the points that it raised. That report included evidence on prices paid by United Kingdom fishing interests, provided by the industry's representatives.
At the beginning of the year it appeared that prices for bunkering fuel were cheaper at other European ports. However, the most recent figures provided by the EEC Commission in March show a marked increase in fuel prices in other member States, so that the range of prices expressed in sterling has narrowed considerably since December, with the relative price movement being in the United Kingdom's favour. Indeed, some United Kingdom consumers are paying substantially less than other EEC consumers.
The figure of 30 per cent. was mentioned, and I believe that my hon. Friend referred to Denmark. The difficulty about comparisons is to try to compare like with like. It may well be that at the port from which my hon. Friend obtained the information spot cargoes were available, on this occasion, at a very low price. However, that cannot be taken as the general price throughout the country in which it was obtained. Therefore, I take my hon. Friend's point seriously. It is on the record. I give him an assurance that we shall investigate the matter to see whether any light can be thrown on it. Even within our country a wide range of prices is available.
The NEDC task force report pointed to the fact that United Kingdom prices were less influenced by spot prices than prices on mainland Europe. The oil companies would argue that over a period of time differences between the United Kingdom and the Continent roughly even out. I know that a joint team from the fishing industry and the

fisheries Departments carefully studied the allegations that fishermen in other countries benefit from lower fuel prices than those applying in the United Kingdom as part of its study into allegations of unfair or illegal imports of fish in the spring. Its conclusions acknowledged the difficulty of making comparisons because of movements in exchange rates which masked the real underlying relativities in pricing and also pointed to the European Community data showing a narrowing in disparities.
The NEDC report is to be updated in the autumn, and we shall look closely at the findings on oil product price movements compared with the Continent.

Mr. Barry Henderson: Does my hon. Friend acknowledge that within the variations in price to which he referred a correlation could be made between the distance of the ports in this country which might have a lower price and how close they are to a possible Continental alternative? Has he observed such a correlation?

Mr. Gray: I have. I thank my hon. Friend for raising that matter. I shall deal with that in a moment. We have made it clear to the oil companies that we expect United Kingdom prices to be fully competitive over a period by international standards.
My hon. Friend mentioned the disparities in fuel prices between various United Kingdom fishing ports. It seems that, especially in fishing ports distant from centres of oil distribution, prices can be substantially higher. But the fishing industry can act against these market forces. Two means that have been shown to produce better prices are, first, the co-operative purchasing of bulk supplies, which gives greater bargaining strength against the oil suppliers, and, secondly, although this is clearly not open to fishermen in all ports—and this relates to the point raised by my hon. Friend the Member for Fife, East (Mr. Henderson)—the use of invoices as evidence of cheaper supplies bought elsewhere on the Continent may be used to force down prices from United Kingdom suppliers.
To some extent that relates to the example that my hon. Friend the Member for Banff gave, that some of his fleet have loaded with substantial supplies of fuel elsewhere, where it could be bought cheaper. If the invoices are retained, that is a means of negotiating with suppliers at home. That could be helpful.
My hon. Friend also mentioned subsidies given by other member States. The joint industry/official team to which I have referred also looked at this. It concluded that there were aids in France and Belgium but noted that neither of these countries provided United Kingdom fishermen with serious competition in the United Kingdom market: both are under review by the European Commission. We are also aware that Italy is providing some fuel subsidies, but those have no direct impact on our industry.
The industry/official team also recognised that the Government have provided very substantial aid to assist our fishermen through a difficult period. Among the factors that the Government took into account in deciding the level of special aid last year was the effect of the costs of fuel on fishermen's net earnings. I am not aware of any criticism by the industry of the total sums that we have provided to vessel owners—over £14 million last year and £25 million this year. I know that there are different opinions on how the money should be allocated, but the totals have not been criticised.

Mr. Albert McQuarrie: My hon. Friend said that he was not a fisheries Minister and is not speaking as one. However, he will accept that the fishing industry is fuel-intensive. Despite the aid granted by the Government, one of the industry's biggest problems is that the prices enjoyed at the quay on landing do not relate to the cost of fuel. Vessels leave port loaded with expensive fuel and return with a catch that does not cover the cost of the journey. That was a point made by the fishing industry when it asked the Government to consider a horse power rating rather than a length of boat rating, which may help.

Mr. Gray: That is a good point. It was a view held by certain people in the industry.
I add that the fishing industry has a valuable concession. Excise duty on its fuel is fully rebated, which is an advantage that I know only too well industry in general would like to enjoy. However, I emphasise that, like the rest of industry, fishing cannot be isolated from the real cost of fuel. Therefore, any endeavours that the industry can make to help the situation will ultimately bring it benefit.
The Government and the White Fish Authority can help the fleet to adjust. They do so, first, with White Fish Authority and Highlands and Islands Board grants to modernise and re-engine vessels for maximum fuel efficiency. The second way is through WFA development of more efficient methods of fishing, which can reduce

weight and drag and thus increase fuel economy. Thirdly, help is given through training offered to fishermen to maintain engines and equipment to get the best performance from their vessels. With the greatest respect to hon. Members who represent fishing areas, we should bear in mind that the Government have done a reasonable amount to help, although not as much as the industry would wish, but few industries receive as much help as they would wish.
I am told that there are opportunities in other areas to improve net income—better handling of fish to maximise quality and better marketing—which will enable the industry to get the maximum return on the rising cost of fuel. I urge the fishing industry to take maximum advantage of the opportunities.
I again thank my hon. Friends the Members for Banff, for Aberdeenshire, East (Mr. McQuarrie) and for Fife, East, who have all taken part in the debate, for their part in looking after the fishing industry that operates around our coast and is based in the North-East of Scotland.
It has been a useful debate. We have noted the points raised. I assure my hon. Friend the Member for Banff that we shall do our utmost to investigate the matters that he mentioned. On this occasion, he will not have to wait too long for a reply.

Question put and agreed to.

Adjourned accordingly at twenty-four minutes past Twelve o'clock.